Donald Trump’s return to US presidency may drive gold prices higher amid global turmoil, say media reports

Geopolitical tensions expected during Trump’s potential second term, especially in the initial year, are anticipated to create significant disruptions in the stock market, which has historically led to a rise in gold prices

Donald Trump’s possible return to US presidency could escalate global trade tensions, exacerbate geopolitical crises, and potentially drive gold prices higher.

Gold, often seen as a safe-haven asset during uncertain times, has already delivered strong returns of approximately 21% this year, outperforming key benchmarks like the Nifty 50, BSE Sensex, and Bank Nifty, as well as outpacing inflation, as per a report in Mint.

The Managing Director of Riddi Siddhi Bullions Limited suggested that Trump’s unpredictable policies, combined with trade disputes and potential conflicts, could encourage investors to lean more heavily on gold as a financial refuge. Similarly, Anuj Gupta, Head of Commodity & Currency at HDFC Securities, predicted that Trump’s second term would bring heightened geopolitical tensions, likely impacting stock markets.

“During Trump 2.0, especially in the first year of his second tenure, the stock market is expected to receive various hits due to the geopolitical tension,” said Gupta. “Such conditions historically drive gold prices upward.”
However, Gupta cautioned that persistent strength in U.S. dollar rates might moderate gold’s expected price increase.

In the short term, Gupta forecast that the MCX gold rate faces a resistance level at Rs 76,800 per 10 grams. If it surpasses this level, prices could rise to Rs 78,000. Recently, gold prices rose by Rs 350 to Rs 79,200 per 10 grams in the national capital, buoyed by robust demand from jewellers and a weakening rupee, according to the All India Sarafa Association.

The ongoing Russia-Ukraine war and tensions in the Middle East are further bolstering gold’s appeal, some traders stated. The yellow metal closed at Rs 78,850 per 10 grams on Dec 19, sustaining its upward momentum.

Meanwhile, silver has also been on an upward trajectory. Rallying for the fourth consecutive session, it surged Rs 900 to Rs 91,700 per kilogram. Over the past four sessions, the white metal gained Rs 3,550 per kilogram, reflecting its own strong performance during this holiday-shortened trading week.

Retail Jeweller India News