How will Trump and Harris' economic policies impact the gold market?

Experts are assessing the impact of former President Donald Trump and Vice President Kamala Harris' economic policies on the gold market.

After months of speeches, polls, debates, and speculation, Election Day has finally arrived. Today, Americans will head to the polls to choose between former President Donald Trump and current Vice President Kamala Harris.

Experts believe that both Mr. Trump and Ms. Harris would cause the dollar to weaken, but Mr. Trump’s policies could send investors rushing into gold. Both sides have plans for big spending and tax cuts. However, their trade policies are very different. Mr. Trump has threatened tariffs, which could increase inflation and push up gold prices.

Gold prices are likely to rise in the near future, regardless of which candidate wins the U.S. presidential election. Photo Kitco News

Bob Haberkorn, a senior commodities broker at RJO Futures, said both administrations would push inflation higher, at least in the near term, but he believes gold prices would push the highest if Ms. Harris is elected.

“ I think Harris would be the biggest gold bull because she would continue the current policies of the Biden administration and the Federal Reserve more. Harris would not cut government spending and would achieve whatever goals she can through tax increases. Although I don’t think she would have the votes in Congress to do anything. I think Harris would be more inflationary for gold, ” he said.

Darin Newsom, senior market analyst at Barchart.com, believes that Trump’s policies will send investors flocking to gold. “I think gold will go higher if Trump wins,” he said. “I think the tax cuts that they’re talking about will be passed, the ones that expire next year will be implemented.”

However, the two candidates' differences on international trade and trade policies could have the most impact on inflation expectations and gold prices.

“ In short, on one side, we have free trade and a global outlook. On the other side, we have anti-free trade and isolationism. That tends to increase inflation, ” Newsom said.

Haberkorn also thinks that Trump's threat of tariffs will lead to higher prices. " If Trump actually imposes tariffs on Europe or any country, it will increase the cost of goods. He is creating the conditions for using tariffs as a form of tax, almost replacing income taxes with tariffs, " he said.

However, Mr Haberkorn said: “ I think at this point it is just a negotiating tactic. If he is elected a lot of these agreements will have to be renegotiated .”

On the other hand, Newsom said that after the experience of Mr. Trump's first term, characterized by high tariffs and high-profile trade disputes, these threats should be taken seriously.

“ I think that would slow down the economic growth we’ve seen in the United States, because it would raise costs again,” he said. “And Mr. Trump has been threatening people with job losses, even talking about raising interest rates to counter the inflation he’s caused through trade wars and tariffs .”

“ Geopolitically, a GOP victory would strengthen the BRICS alliance, which includes Brazil, Russia, India, China… So, again, we’re in a safe-haven market with everything else collapsing. I think that would be supportive of gold, ” Newsom said.

Gold prices could continue to rise in the second half of Harris’ term. However, if Trump is re-elected, he could pursue policies that address long-term fiscal issues, which could slow the rise in gold prices.

Haberkorn said Trump could implement more spending cuts in a second term, which could lead to deflation and put downward pressure on gold prices. However, he also noted that Trump has talked about cutting spending in the past but failed to follow through.

Newsom believes that if Ms. Harris wins, gold prices could be supported by geopolitical concerns, such as the ongoing conflict in Ukraine.

In short, gold prices are likely to rise in the near term regardless of which candidate wins the presidential election. However, if Ms. Harris is elected, gold prices could continue to rise during her term. Conversely, if Mr. Trump is re-elected, his policies could slow the rise in gold prices.

Source: https://congthuong.vn/chinh-sach-kinh-te-cua-trump-va-harris-tac-dong-den-thi-truong-vang-nhu-the-nao-357136.html