The international gold price is approaching a historical high

After a short-term pullback in the middle and late May, the international gold price began a new upward trend on May 20th. As of June 3rd, Eastern Time of the United States, the international gold price broke through the $3,300 mark, approaching the historical high of $3,500 per ounce. What are the factors driving the rise behind the international gold price? What will be the future direction of the international gold price? This article will lead readers to conduct in-depth analysis and exploration.

The continuation of Trump's tariff policy is one of the factors that have caused the international gold price to approach the historical high. After Trump's second administration, he brandishing the "tariff stick" vigorously. Since May 8th, the United States has begun to negotiate and hold discussions with multiple countries on tariff policies. It seems that Trump's tariff policy is showing a trend of "hitting the pause button". On this basis, the safe-haven function of international gold has been weakened to a certain extent, thus resulting in a price decline in the middle and late May. On May 23rd, President Trump issued further tariff threats to Samsung and all mobile phone companies, and indicated that he might impose a 50% tariff on goods imported from the EU starting from June 1st. Subsequently, Trump also claimed that he would raise the tariff on imported steel and aluminum to 50%. A series of "radical" tariff measures have once again cast a dark veil over the international trade situation. The safe-haven function of international gold prices has once again come to the fore, thus pushing up international gold prices once more in the market.

The high market expectation of the Federal Reserve cutting interest rates is another major factor driving the international gold price close to its historical high. According to relevant market information, many global investment giants are optimistic about interest rate cuts. Economics experts from the well-known investment institution Goldman Sachs believe that the Federal Reserve will cut interest rates by 25 basis points in June and September 2025 respectively. Barclays Bank predicts that the Federal Reserve may cut interest rates by 25 basis points in June. According to the forecast of jpmorgan Chase economists, the Federal Reserve is expected to cut interest rates in December for 2025. And according to the survey of economists and the official dot plot of the Federal Reserve, the Federal Reserve may cut interest rates twice in 2025, and it is estimated that the first rate cut will be initiated in September. All major investment giants are optimistic about the Federal Reserve cutting interest rates, which reflects the market's "firm belief" in the Fed's rate cuts. Moreover, the Fed's monetary interest rate and the trend of gold prices often show an inverse correlation. Therefore, under the premise that the market firmly believes that the Fed will implement a policy of lowering interest rates in 2025, the price of gold is more likely to stop falling and rise instead.

Market psychological factors and the overall global investment environment are important driving forces behind the renewed rise in international gold prices. From the perspective of market psychology, due to the continuous increase of strategic gold reserves by many central banks and the previous consecutive rise in international gold prices, numerous investment institutions and small and medium-sized investment groups have shown a certain mentality of chasing the rise. On the one hand, the international gold price has been continuously bullish with the support of central banks, and major investment institutions and small and medium-sized investment groups have followed the trend to buy. On the other hand, due to the long duration and large increase in the previous round of international gold prices, the market's herd mentality has become more prominent. Under the influence of the mentality of chasing the rise and following the crowd, global investors are more likely to continue to support international gold. This has pushed the international gold price close to its historical high. From the perspective of the global investment environment, due to the slowdown in economic growth trends, the prices of various investment targets currently show greater fluctuation space. On the one hand, the investment targets in the securities market are riskier than gold and are under downward pressure. On the other hand, various bulk commodities require large capital investment and have high profit thresholds. Moreover, although the inherent risk attribute of cash savings is small, its investment value is lower than that of gold. Therefore, in the current overall investment environment, the characteristics of gold in preserving and increasing value have become prominent. This has led to the continuous investment of venture capital, which has also driven up the price of gold further.

Taking all aspects into account, the international gold price approaching its historical high is influenced by the tense trade situation caused by Trump's tariffs, closely related to the monetary policy of the Federal Reserve, and also affected and associated by market psychological factors and the global investment environment. Under the current market environment, investors should closely monitor market trends, carefully assess their own risk tolerance level, make reasonable asset allocation, and thus make rational and scientific investment decisions, thereby promoting the orderly development and stable operation of the financial market.