India Gold price today: Gold extends recovery as US-China trade war deepens

Deepening US-China trade war continues to bolster the haven demand for Gold price in India on Thursday, even though the global stocks rebound on US President Donald Trump's "90-day pause" on reciprocal tariffs for all other countries.  

Gold price also shrugs off the ongoing Chinese disinflation amid the market's nervousness on US-Sino trade woes and ahead of the US Consumer Price Index (CPI) data release. 

At the time of writing, Gold price changes hands at 8,668.09 Indian Rupees (INR) per gram, advancing from Wednesday's close of INR 8,550.30, according to data compiled by FXStreet.

Gold price rose sharply to INR 101,094.90 per tola from INR 99,728.98 per tola a day earlier.

Global Market Movers: Gold price remains well supported by a further escalation of the US-China trade war

• In less than 24 hours after steep new tariffs kicked in on Wednesday, US President Donald Trump abruptly took a U-turn and announced a 90-day pause on hefty duties on most nations for 90 days. Trump, however, jacked up the tax rate on goods from China to 125% after the latter declared that it is putting an additional 50% tariff on US imports.
• Investors now seem worried that an all-out trade war between the world's two largest economies would stoke inflation and
• hinder global growth. This, in turn, assisted the safe-haven Gold price to rise more than 2% on Wednesday and post its best day since October 2023. The momentum seems unaffected by a sharp recovery in equity markets.
• Traders slashed their bets for more aggressive rate cuts by the Federal Reserve (Fed) after March FOMC meeting minutes revealed that officials unanimously agreed that the US economy was at risk of experiencing higher inflation. Adding to this, a slew of influential Fed policymakers called for a cautious approach to interest rate cuts.
• Minneapolis Fed President Neel Kashkari said that the bar for cutting rates remains high as tariffs can lead to inflation. Adding to this, Cleveland Fed President Beth Hammack noted that monetary policy is modestly restrictive right now, though he would prefer to wait than move in the wrong direction with interest rates.
• Separately, Richmond Fed President Tom Barkin warned that tariff price hikes could begin by June and price surges require the US central bank to be cautious. Furthermore, St. Louis Fed President Alberto Musalem said that it is risky to assume the Fed can look through higher prices from tariffs, there is a chance some effects could persist.
• Traders were quick to react and are now pricing in the possibility that the Fed will resume its rate-cutting cycle in June and deliver just 75 basis points of rate reductions over the course of the year. This, however, does little to assist the US Dollar to capitalize on the overnight bounce or attract any sellers around the non-yielding yellow metal.
• Investors now look forward to the release of the US consumer inflation figures, which will be followed by the US Producer Price Index (PPI) on Friday, for fresh cues about the Fed's rate-cut path. This, in turn, will play a key role in influencing the near-term USD price dynamics and providing a fresh directional impetus to the XAU/USD pair.

FXStreet calculates Gold prices in India by adapting international prices (USD/INR) to the local currency and measurement units. Prices are updated daily based on the market rates taken at the time of publication. Prices are just for reference and local rates could diverge slightly.

(An automation tool was used in creating this post.)