AGE Daily Gold Update

AGE Daily Gold Update presents a recap on today's action in the precious metals markets. View archives.

3/3/2025: Metals rebound as the first tariff economic ripples are felt

Source: Dana Samuelson, American Gold Exchange

Austin — Gold, silver, platinum and palladium all rebounded sharply in New York trading today following the release to the Feb. ISM manufacturing report which revealed the first ripples of the Trump administrations aggressive tariff policies are being felt economically in the manufacturing sector. Gold jumped 1.9%, silver 2.8%, platinum 2.9% and palladium 4.3%.

The ISM headline reading fell 0.6 points to 50.3, revealing the manufacturing sector was slowing but remained in expansion. A number above 50 indicates economic expansion while a number below 50 indicates contraction.

Undermining the expanding but slowing economic activity, however, was the MoM 7.5 point surge to 62.4 in prices paid, the highest cost input reading since the summer of 2022 when inflation was raging higher. Prices paid by manufacturers have been rising for 5 months in a row, indicating inflation risks remain elevated, but this month’s abnormal spike in input costs reflected sudden, sharply higher prices for steel and aluminum manufacturers are now paying due to blanket tariffs being placed on them by the Trump administration effective March 12th.

New orders fell into contraction, dropping 6.5 points to 48.6, the largest MoM contraction since April 2020. With new orders declining, and costs rising, producers may be caught between and rock and a hard place moving forward. Can manufacturers pass along price increases to retail consumers, and by how much, when retail buying activity is declining?

Consumer spending fell 0.2% in January, the first decrease since March of 2023 and the biggest decline in four years. Consumer spending was robust in December, rising 0.8% MoM as consumers seemingly front ran potential tariff price increases, but have now pulled back.

The dollar tumbled over 1.00 on the US dollar index, from 107.5 to 106.5, following the release of the ISM report. Metals, conversely, gained on the back of the falling dollar, and more importantly, the growing possibility of stagflation through slower growth and rising prices.

New York spot gold gained $53.40 to $2,890.20; silver jumped 81 cents to $32.03; platinum rose $28.31 to $958.43; and palladium popped $42.85 to $942.55 an ounce.