TLDR
- Gold prices hit a new all-time high above $3,200, with a 5.5% weekly gain
- Tether’s XAUT (tokenized gold) is a top-performing digital asset, up 3.4% in 24 hours while broader crypto markets remain flat
- Investors are seeking safe-haven assets due to US-China trade tensions, with tariffs on Chinese goods reaching 145%
- Concerns about Federal Reserve independence and US financial stability are contributing to gold’s rally
- Asian equity markets showed mixed results, with tokenized gold sector up 4.3% compared to the CoinDesk 20 index down 2%
Gold prices surged to a new all-time high above $3,200 on Friday, with tokenized gold becoming a top performer in digital asset markets. Tether’s XAUT and other gold-backed tokens are gaining popularity among crypto investors seeking safe havens amid global economic uncertainty.
The price of physical gold breached its lifetime high during late US trading hours before experiencing a slight pullback in early Asian trading. Currently, gold trades at $3,218 in Hong Kong markets, on track for a weekly gain of approximately 5.5%.
Tokenized gold has become a bright spot in otherwise flat crypto markets. Tether’s XAUT, the largest tokenized gold by market cap, rose 3.4% in the last 24 hours, making it a top-10 performer among all digital assets.
According to CoinGecko data, the tokenized gold sector overall gained 4.3%, while the CoinDesk 20 index of major cryptocurrencies fell 2%.
XAUT Price
Trade War and Monetary Policy Concerns Drive Gold Rally
The ongoing trade dispute between the US and China has created market uncertainty despite recent attempts at de-escalation. President Trump’s administration raised tariffs on Chinese goods to 145%, including a 125% base rate plus additional retaliatory levies.
China responded with 84% tariffs of its own and has strengthened ties with European and Asian partners. Chinese state media reports that stimulus measures are planned, including interest rate cuts and government spending of approximately $136 billion.
These tensions are unfolding alongside concerns about US Federal Reserve independence. On April 9, US Supreme Court Chief Justice John Roberts temporarily reversed a court ruling that had prevented the US President from firing members of independent agencies. This has raised fears that President Trump could remove Fed Chair Jerome Powell.
Recent US inflation data showed signs of cooling, with March Consumer Price Index (CPI) rising just 0.1%, putting the 12-month inflation rate at 2.4%, down from 2.8% in February. This has led traders to price in three to four interest rate cuts by year-end.
Gold’s Appeal in Current Economic Climate
Several factors are contributing to gold’s strong performance in both physical and tokenized forms. The metal typically rallies during periods of economic or geopolitical uncertainty as investors seek assets viewed as stores of value.
Gold also benefits from an inverse relationship with interest rates: lower rates reduce the opportunity cost of holding non-yielding gold. With rate cuts on the horizon, gold becomes more attractive to investors.
The growing US budget deficit has added another reason for investors to turn to gold. These concerns have weakened the US Dollar Index (DXY), which fell 0.8% to hover near the 100.06 mark on Friday.
In India, gold futures also reached new heights, with June futures on the MCX rising 1.41% (Rs 1,300) to hit Rs 93,736 per 10 grams. Silver futures also gained, rising by Rs 870 or 0.95%.
Asian equity markets showed mixed results on Friday morning, with Hong Kong’s Hang Seng down 0.2%, Shanghai’s SSE up 0.12%, Taipei’s TAIEX up 1.6%, and Tokyo’s Nikkei 225 down 3.5%.
Other strong performers in crypto markets included Curve DAO’s CRV token, which rose 18% after news that the US plans to relax rules and enforcement related to Decentralized Finance (DeFi).
Market watchers now await the release of US Producer Price Index data and University of Michigan Inflation Expectations, though trade war developments are expected to remain the primary market driver.
Technical analysis indicates gold may have further upside potential before any buyer exhaustion sets in. The immediate resistance level is seen at $3,250, with a possible move toward $3,300 if momentum continues.
