Trump Announces Emergency Energy Status, Oil Prices Plunge
(New York, 22nd) U.S. President Donald John Trump ’s recent policy announcement has significantly affected global markets, leading to a sharp decline in oil prices. Trump’s declaration of a national energy emergency has raised concerns about the U.S. increasing oil production substantially, which could result in a global oversupply. February oil futures on the New York Mercantile Exchange closed down by $1.99, or 2.55%, at $75.89 per barrel. Meanwhile, Brent crude futures also fell, by $0.86 or 1.07%, closing at $79.29 per barrel.
Trump ‘s Tariff Comments Drive Gold Prices Up
Trump’s remarks about potentially imposing tariffs on Canada and Mexico triggered fears of escalating trade wars, which in turn led to a surge in gold prices. February gold futures in New York rose by $10.50, or 0.4%, closing at $2759.20 per ounce. Spot gold briefly rose to $2745.97 per ounce, a two-month high, before closing at $2744.81, a 1.35% increase.
Safe-Haven Funds Flow Into Gold Market, Boosting Gold Prices
Trump’s comments have sparked an increase in investor caution, leading to a significant flow of funds into the gold market. Gold, as a traditional safe-haven asset, has become the investment choice for those seeking to preserve value amidst economic uncertainty.
Oil Prices Decline and Gold Prices Rise in Tandem
Analysts believe that Trump’s push to increase oil production could suppress oil prices, while the rise in gold prices reflects global market anxiety. With inflationary pressures easing, the Federal Reserve may consider further rate cuts, which would also support gold prices.
Gold Prices Face Technical Resistance, Breakthrough Challenging
While gold prices have been strong in the short term, analysts point out that they face substantial technical resistance around $2785, making a breakthrough difficult. Therefore, despite gold’s ongoing strength, overcoming historical highs is not an easy feat.