Amid tariff war fears, safe-haven gold hits all-time high at Rs 64,280/sovereign

CHENNAI: Gold prices raced to an all-time high in capital Chennai on Wednesday as trade war fears triggered by US President Donald Trump’s fresh tariff threats and rising global economic uncertainties drove safe haven demand.

Though jewellery stores in commercial areas like T Nagar and Parrys either saw regular footfall or a dip in sales, gold prices continued to be steep at Rs 64,280 per eight gram.

“The increase in price has been due to the purchase of gold by those buying the metal as an asset class,” said L Akshay, a retailer in Sowcarpet..

Local sellers say the demand for gold will increase in the future. "Demand for physical gold has increased globally. This would lead to an increase in demand and price in the future. Uncertainties in other investment areas will make gold a better investment option for investors," said gold guru Santhakumar, secretary, Madras Jewellers and Diamond Traders Association.

"Retail gold sales have come down by 30 per cent due to the increase in price but consumers still purchase it as they fear it might become costlier to buy in future," Santhakumar added.

"The buzz in the Chennai, Coimbatore and Madurai markets is that the trade war tensions and concerns over global economic growth had driven investors to look at gold as safe haven, following US President Donald Trump's new tariff threats," says a vice-president with an asset management company.

Over the past ten years, gold returns had been less than real estate and shares; and now with equity markets tanking, investors are migrating towards gold, parking a few percent of their assets in it.

Analyses by mutual fund leaders foresee poor returns in stocks and mutual funds and this will escalate the gold price until 2026. Returns in gold have been long due and it is happening now, he added.

Among other metals, silver continued to be stable, market sources added.