Gold Market Turmoil: Tariffs Spark Chaos in Global Bullion Trade

A US ruling suggesting that gold bars would be subject to tariffs caused chaos in the global gold market, with prices surging to a record before tumbling after the Trump administration clarified that imports of gold bars wouldn't face tariffs. The market relies on a complex network of banks, refineries, and couriers that can move bullion between key trading hubs. Tariffs would have dire consequences for the market, insiders warned.

The global gold market was thrown into chaos this week following a U.S. ruling that suggested gold bars would be subject to tariffs. The announcement, made by the U.S. Customs and Border Protection (CBP), caused gold prices to surge to record levels before tumbling after the Trump administration clarified that imports of gold bars would not face tariffs. The market relies on a complex network of banks, refineries, and couriers that move bullion between key trading hubs, and tariffs would have dire consequences for this intricate system.

The Tariff Announcement

On July 31, 2025, the CBP issued a letter reclassifying one-kilogram and 100-ounce gold bars under customs codes subject to duties [1]. This reversal came amid heightened trade tensions between the U.S. and Switzerland, which is the world's top gold refiner. The tariff decision was expected to disrupt global bullion flows and deal a significant blow to Switzerland's gold trade.

Market Reaction

The immediate impact of the tariff announcement was evident in gold futures prices. Gold futures on the New York Comex exchange surged to an all-time high of $3,534 per troy ounce, briefly hitting a record before tumbling to around $3,450 per troy ounce [1]. The premium over benchmark spot prices in London also spiked, reflecting the market's uncertainty and the potential impact of the tariffs.

Swiss Gold Trade Impact

Switzerland, which exports about $61.5 billion worth of gold to the U.S. annually, would have faced an additional $24 billion in annual duties under the new tariff [1]. Industry sources reported that some Swiss refineries had suspended or reduced shipments to the U.S. while seeking legal clarity on product classifications [1]. Christoph Wild, president of the Swiss Association of Manufacturers and Traders of Precious Metals, warned that the tariff would make it difficult for Switzerland to meet U.S. demand for gold [1].

Trump Administration Clarification

The market's uncertainty was short-lived, however. On Friday, the Trump administration issued an executive order clarifying that there would be no duties imposed on gold bars from Switzerland [2]. The order, which was signed by President Trump, reversed the earlier tariff decision and restored the expected exemption for gold bars.

Gold Mining Stocks

The tariff announcement also had an immediate impact on gold mining stocks. Shares of companies like Freeport-McMoRan (FCX), Royal Gold (RGLD), and US Gold Corp. (USAU) closed higher on Friday, outperforming the broader market [2].

Long-term Implications

The tariff ruling and subsequent clarification highlight the sensitivity of the global gold market to regulatory changes. The U.S. has a significant influence over global bullion markets, and policy shifts can have far-reaching implications for refining industries and geopolitical commodity dynamics [3]. The long-term effects of the 39% tariff on one-kilogram gold bars remain to be seen, but the immediate consequences underscore the market's volatility.

References

[1] https://www.mining.com/us-slaps-tariffs-on-1-kg-100-oz-gold-bars-financial-times/
[2] https://www.investopedia.com/trump-puts-tariffs-on-gold-bars-sparking-chaos-in-bullion-market-11787624
[3] https://www.ainvest.com/news/39-tariff-kilo-gold-bars-sparks-market-turmoil-2508/