StoneX CEO: Gold Market Volatility Driven by Tariff Uncertainty

As the global markets enter Q4 2024, the gold market continues to be a hot topic of discussion, with shifting monetary policies, weather disruptions, and China's economic slowdown all playing a role in shaping its trajectory. In a recent interview, StoneX Group CEO Philip Smith shared his insights on the gold market's volatility and the impact of tariff policies on the precious metal's price.

Smith pointed to a major pricing disconnect between New York futures contracts and the London OTC physical market, with a range of $25 to $30 per ounce compared to the December high of $60. This divergence, fueled by a lack of clarity from the new administration over tariffs, has been affecting the market's overall efficiency. "The ongoing ambiguity surrounding tariffs is exerting a disproportionate and distorting effect on gold prices," Smith explained.

Smith also noted a significant surge in physical gold moving into the United States over the past two months, estimating over 2,000 tons. This unprecedented movement, equal to roughly 40% of the total gold held at Fort Knox, highlights the extraordinary scale of this shift and the opportunities it presents for companies like StoneX.

The CEO attributed this market disruption to uncertainty over Trump's tariff policies, which are creating a "disproportionate and distorting effect on gold prices." Smith believes that once certainty is established, gold markets can revert to normal fundamentals, allowing for greater price stability and more predictable trading conditions.

StoneX's Precious Metals division is well-positioned to support large banks and financial institutions that lack direct access to physical gold, helping them navigate uncertainties related to tariffs and market disruptions. The company's comprehensive suite of gold services, including physical trading, financial derivatives, vaulting, and storage, enables them to facilitate physical gold movements during periods of market stress.



The tariff policy ambiguity and market disruptions create opportunities for StoneX to increase its market share and revenue in the precious metals division. The company's ability to provide comprehensive solutions for physical gold trading and storage becomes more valuable when traditional channels are stressed, potentially leading to increased market share and revenue opportunities.

In conclusion, the gold market's volatility in Q4 2024 is driven by tariff uncertainty and market disruptions, presenting both challenges and opportunities for companies like StoneX. As the global markets continue to evolve, StoneX's strategic advantages in facilitating physical gold movements and providing comprehensive precious metals services position them well to capitalize on these market dynamics.