Top Stories This Week: Gold Price Rises, Trump Talks Tariffs, Trudeau Resigns

Gold was on the rise during the first full week of the new year, with futures ending above US$2,715 per ounce.

The yellow metal is seeing support from a variety of factors, including turmoil related to incoming US President Donald Trump. CNN reported on Wednesday (January 8) that Trump is considering declaring a national economic emergency in order to legally justify a wide-ranging set of tariffs on both ally and adversary countries.

Trump's team hasn't confirmed this plan, but it would allow him to build a tariff program via the International Economic Emergency Powers Act (IEEPA), which gives the president the ability to manage imports during a national emergency.

"I think the president has broad authority to impose tariffs for a variety of reasons, and there are a number of statutory bases to do so. IEEPA is certainly one of them" — Kelly Ann Shaw, Trump’s deputy assistant for international economic affairs

The lack of clarity on Trump's tariffs has also boosted New York prices for both silver and copper futures. That's creating opportunities for nimble traders who are able to take advantage of the disparity with London prices, but could result in squeeze scenarios — this is similar to what helped copper prices take off last year.

Gold also reacted this week to a weaker-than-expected private employment report out of the US. It shows that the economy added 122,000 jobs in the private sector in December, lower than the estimated rise of 140,000.

"(Weaker private payrolls data) is contributing to gold's move, because ultimately, weaker employment numbers imply that the economy has been weaker than many had expected," Bart Melek of TD Securities told Reuters.

However, the main data point investors were waiting for came on Friday (January 10), with the release of the latest US jobs report from the Bureau of Labor Statistics. It shows that nonfarm payrolls rose by 256,000 in December — that's the most since March, and much higher than expected. Meanwhile, the unemployment rate fell to 4.1 percent,

The news has reinforced expectations that the US Federal Reserve will leave interest rates unchanged when it meets later this month. Its most recent dot plot shows officials expect only 50 basis points worth of cuts in 2025.

The news that the People's Bank of China bought gold in December also helped gold this week. Although the central bank took a six month pause on purchases in 2024, it started adding gold to its reserves once again in November.

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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.

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