KUWAIT CITY, April 13 : Gold prices reached historic highs in trading last week, driven by global factors such as escalation of the trade war between the United States of America and China, the continuation of global geopolitical crises, and the decline of the US dollar to its lowest levels in nearly two years. However, the impact was felt particularly in Kuwait, where gold prices saw significant increases.

According to a special report issued by the Kuwaiti company Dar Al-Sabik on Sunday, the price of spot gold surged to $3,245.45 per ounce, marking a 6.9 percent weekly gain. This rise was attributed to the weakening US dollar and an increased demand for safe-haven assets, driven by fears of a global economic slowdown. Also, the price of gold futures for June delivery closed at $3,244.60 per ounce, up by $67.10 (2.1 percent) in a single session.

Locally, the price of 24-carat gold in Kuwait was reported at KD 32.1 per gram (approximately $98), while 22-carat gold stood at about KD 29.42 (approximately $90) per gram. Silver prices remained stable at KD 370 per kilogram (about $1,209). On the global front, the increase in gold prices was influenced by the escalation of the trade war between the United States and China to unprecedented levels, ongoing geopolitical crises, and a significant drop in the US dollar. The dollar index hit a two-year low of 99.01 points, which is the lowest since May 2022, following the release of weak US economic data, including a 0.4 percent month-on-month drop in the producer price index for March, marking its first contraction in 17 months. In addition, the annual inflation rate based on the producer price index fell from 3.2 percent in February to 2.7 percent, while core inflation, excluding food and energy, remained above 3 percent, reaching 3.3 percent. These inflationary pressures pose ongoing challenges for US monetary policymakers. The University of Michigan survey revealed a sharp decline in US consumer confidence, with the index dropping from 57 points in March to 50.8 points in the preliminary April reading.

This decline reflects growing pessimism among US households regarding economic conditions, as well as a rise in inflation expectations from 5 percent to 6.7 percent in the short term and from 4.1 percent to 4.4 percent in the long term. The trade war between the United States and China has reached unprecedented levels, following Washington’s decision to raise tariffs on Chinese products to 145 percent. In response, Beijing imposed a 125 percent tariff on American goods, impacting more than $700 billion in bilateral trade between the two countries.

This escalation significantly boosted global demand for gold as a safe-haven asset, driving its price above $3,200 an ounce, where it remained stable, despite a rise in real yields on ten-year US Treasury bonds to 2.307 percent, a development that typically exerts downward pressure on gold prices. The Dar Al-Sabik report stated that gold’s ability to maintain its gains despite rising returns reflects the growing influence of geopolitical tensions and global uncertainty, which are currently outweighing the impact of traditional monetary policy. It predicted that markets will be influenced this week by several important factors, including the acceleration of quarterly earnings announcements from Wall Street-listed companies, as well as the release of important economic data such as U.S. retail sales and industrial production, China’s economic growth figures, and inflation and labor market data from the United Kingdom. In addition, decisions from major central banks including the European Central Bank, the Bank of Canada, and the Bank of Korea, are expected to impact market sentiment. (KUNA)