Gold Prices Surge as Trump Triggers Risk-Off Avalanche — Gold prices surged to a four-week high on Tuesday after President Donald Trump threatened to tough it out with China for another year over trade, making the prospect of a painful next round of tariff increases on Chinese goods much likelier.

Speaking in London ahead of a NATO summit, Trump said that a trade deal with China may have to wait until after the 2020 election, shaking markets that had been lulled into thinking an agreement was imminent by a string of reassuring comments by both Washington and Beijing over the previous weeks.

Trump’s comments, which came hot on the heels of two separate announcements to raise tariffs on trade partners in Europe and Latin America, triggered a snowballing decline in risk assets, with havens such as gold and Treasury bonds being the main beneficiaries.

By 11:30 AM ET (1630 GMT), gold futures for delivery on the Comex exchange were up nearly $16, or 1.1%, at $1,484.85 a troy ounce, having earlier touched $1,487.65, their highest level since early November.

Likewise, the 10-year Treasury yield fell 13 basis points to 1.71%, its lowest in a month and the more interest-rate sensitive two-year yield fell 9 basis points to its lowest in eight weeks, at 1.52%. Meanwhile, the Swiss franc hit its highest level against the dollar in a month.

Silver futures rose 1.7% to $17.25 an ounce, their highest in 10 days, while platinum futures rose 1.3% to $911.70.

Ned Naylor-Leyland, a portfolio manager with Merian Global Investors, argued in a blog post that there is still ample space for both gold and silver to rally, given the backdrop of falling real interest rates and central bank balance sheet expansion.