Gold futures surging to record peaks
In a recent report by the Financial Times, it has been revealed that the US tariffs on imported goods from Switzerland could potentially impact Switzerland's significant gold exports to the US, particularly one-kilogram bars.
According to the report, if the US tariffs of 39% on imported goods from Switzerland are applied to gold, duties of $24 billion could be imposed on gold imports from Switzerland. This could lead to disruptions and reductions in Swiss gold exports due to uncertainty and tariff classification issues.
Switzerland exported gold worth $61.5 billion to the US in the 12 months up to June. However, imprecise customs classification has caused confusion, leading at least two Swiss refineries to temporarily reduce or halt exports to the US amid tariff uncertainty.
The US Customs Border Protection Agency (CBP) has issued a notice stating that gold bars weighing one kilogram and 100 ounces will be subject to duties. This contradicts the industry's previous expectations of duty-free precious metals refined in Swiss refineries and exported to the US.
The US administration's clarifications on tariff policies for gold bars in August aimed to reduce misinformation and price volatility, but the issue of precise customs codes continues to create export uncertainty for Swiss gold refiners.
The increase in gold prices in New York is due to investors' expectations of how the value of the precious metal will develop, as reflected in futures contracts. At one point, the gold price in New York reached an all-time high of over $3,530. The gold price in London remained relatively stable compared to New York.
It's important to note that the report does not mention any specific announcement by Donald Trump regarding tariffs on gold imports. The source of the information is ntv.de and jki/dpa.
The increase in gold prices in New York following the announcement of US tariffs on gold bars could be a reflection of market uncertainty and anticipation of potential trade disruptions. The sizes common in London are often reshaped into those common in New York in Switzerland, with the one-kilogram bars being the most commonly traded format on the New York futures exchange Comex.
This potential impact could be problematic for Switzerland, given the significant portion of Switzerland's gold exports to the US that are one-kilogram bars. The Financial Times also reported that this could lead to challenges for Switzerland, particularly if the tariffs are applied to gold imports.
In conclusion, US tariffs and related classification ambiguities have the potential to hinder Swiss gold exports to the US, causing temporary export pauses and creating uncertainty for Swiss precious metals firms, despite the very large trade volume involved.
Businesses and policies within the Swiss gold refining industry may face risks due to the employment and community policies required to adapt to potential tariffs on gold exports to the US. For instance, as the US tariff policy for gold bars contradicts industry expectations, refineries might need to invest in legal counsel or industry lobbying efforts to address tariff classification issues. Furthermore, if the US imposes tariffs on gold imports, the resulting increased costs could impact employment and production levels within the Swiss gold refining sector.
