What happened to the gold price in Q1?

Gold began the year at US$2,658.04 per ounce on January 2, and continued to rise throughout the first month of the year, reaching US$2,710.30 during Trump’s inauguration on January 20.

Gold price, January 2 to April 7, 2025.

Chart via Trading Economics.

Its upward trajectory accelerated in February. Gold climbed above the US$2,800 mark on February 3, broke through US$2,900 on February 10 and reached a monthly high of US$2,949.90 on February 24.

The metal retracted before the start of March, falling to US$2,856.90 on February 28.

However, March brought more excitement for investors as the price once again started to climb, rising above the US$2,900 mark by March 4. Gold continued to set records during the month, closing above US$3,000 on March 18 and then establishing a new record of over US$3,165 in early April.

Gold had once again dipped below the US$3,000 mark as of April’s second week.

Gold and Trump’s tariff threats

When Trump won the US election, analysts widely predicted his presidency would be defined by chaos.

Much of his first presidential term saw him challenge standard operating procedures on diplomacy and rhetoric, but he was largely constrained by experienced Washington insiders.

During his second term, Trump has chosen to surround himself with loyalists who agree on policy direction.

The first quarter brought about destabilization in world financial markets as Trump threatened to impose sweeping 25 percent tariffs on Canada and Mexico, its longtime trade partners. According to the Office of the US Trade Representative, trade between the three countries totaled over US$1.5 trillion in 2022.

Initially Trump was demanding that Canada and Mexico tighten border rules to prevent the flow of migrants and fentanyl into the US. However, he also suggested that the tariff threat stemmed from trade deficits.

The first of Trump’s threats came on February 1, when his administration applied tariffs to imports from Canada and Mexico; he walked them back two days later, saying he would delay them until March. When the March deadline arrived, the US once again imposed tariffs on Canada and Mexico, but then retracted them, suggesting they would be added on April 2, when the US was also planning broader reciprocal tariffs against all countries.

“There has been a huge spike in the movement of physical gold from around the world into US depositories. This seems to have been driven by the global political stress and potential tariff impacts. The amounts involved have caused disruption in the real demand and promoted new buyers as well,’ he said.

These movements created significant price differences between the London and New York markets, as UK buyers worried about a shortage of physical gold, while US banks sought to exploit the price gap.

Geopolitical conflicts creating tension

With Russia-Ukraine tensions remaining high and a Middle East conflict that seems poised to boil over, gold investors have responded by seeking the relative safety of physical and liquid assets.

“Broader global political tension, the Middle East conflicts and the Ukraine invasion all add uncertainty, and none of these should be ignored. All those inputs are real and do not look like they will abate anytime soon,” said Barrett.

Both major conflicts in Eastern Europe and the Middle East show no signs of easing.

A ceasefire negotiated between Israel and Hamas earlier this year has collapsed since the beginning of March.

This has led to a serious escalation, with Israel attacking more targets in Gaza and the US increasing its strikes against Iran-backed Houthi rebels in Yemen. The US has also begun more troop and equipment movements into the region, and some analysts believe it is preparing for direct action against Iran. This sentiment was reinforced when Trump stated, “If they don’t make a deal, there will be bombing,” during a call with NBC News on March 30.

The three year war between Russia and Ukraine continues with no end in sight. While it seems that both sides have accepted a ceasefire, the final terms and how it will be implemented remain uncertain.

In recent weeks, Russia has intensified its attacks on Ukraine, targeting critical infrastructure and civilian areas. This has drawn Trump’s ire, and he threatened oil and gas tariffs on Russia during his NBC interview.

Gold’s foundational drivers still present

Central banks have been a major gold price driver over the past few years, and data published by the World Gold Council on March 4 indicates that they remained active during the first month of the year.

In January, they added more than 18 metric tons of gold to their reserves.

Uzbekistan’s central bank led the way with 8 metric tons, while the People’s Bank of China contributed 5 metric tons, increasing its official total to 2,285 metric tons. The National Bank of Kazakhstan added 4 metric tons.

Barrett explained that central bank purchases have been crucial to gold’s increases over the past decade.

“Since late 2015, gold has risen from approximately US$1,000 to the present record highs above US$3,000, and central banks have bought up 10,000 metric tons, depending on who you ask. This demand removes supply from the market; they are the ultimate buy-and-hold participants — this has been the real driver for gold,” he said.

For her part, Khandoshko does not view central bank purchasing as significant in the current environment.

“The more important factor here is their monetary policies. Despite attempts to maintain a conservative stance, it is evident that the cycle of interest rate cuts is already underway,” she said.

Lower interest rates have long been correlated with increased gold buying from investors.

In another report, the World Gold Council states that physically backed gold exchange-traded funds (ETFs) saw US$9.4 billion in inflows during February, the strongest since March 2022.

February also marked the third consecutive positive month of ‘strong global inflows.’

Overall, assets under management for these ETFs rose by 4.1 percent to US$306 billion, with collective holdings increasing by 3.1 percent to 3,353 metric tons, the highest month-end level since July 2023.

Gold price outlook for 2025

Among the factors that could provide fresh tailwinds for gold is a new pilot program from the National Financial Regulatory Administration of China. It allows 10 insurance companies to invest in gold.

“Given the recent price rise, the global backdrop and the huge Chinese population, this may develop into a strong driver,” Barrett said. The program permits the designated insurance companies to allocate up to 1 percent of their assets to bullion, which could translate into US$27.4 billion in new gold investments.

Barrett emphasized the importance of monitoring the main drivers in the gold market.

“Clarity on the Trump administration’s tariff policy, even its overall economic plan, may alleviate some physical demand as well as those concerned about the need for a hedge,” he said.

Although he noted that conflicts in Ukraine and the Middle East are unlikely to change due to their complexity, he suggested that relief from ceasefires or a reduction in violence could help diminish investor anxiety.

Khandoshko mentioned that as long as geopolitical turmoil, economic instability and currency devaluation persist, the gold price will continue to benefit as these elements are driving its momentum.

“This surge over the US$3,000 mark is just the beginning,’ she said.

‘The yellow metal will continue to increase in price, setting new records. What we are witnessing is not a temporary spike, but a lasting shift in the market. With this breakthrough, a significant pullback seems unlikely. Corrections and volatility may occur, but the market has entered a new era, one that is here to stay.’

Lithium market continuing to rebalance

Over the last five years, annual global lithium carbonate production has ballooned, rising from 82,000 metric tons in 2020 to 240,000 metric tons in 2024, representing a 192 percent increase.

As output more than doubled, demand failed to keep pace, leading to massive market oversupply.

In a February report, Fastmarkets analysts note that the lithium market saw an estimated surplus of 175,000 metric tons in 2023 and 154,000 metric tons in 2024.

The firm expects this surplus to continue contracting in 2025, with experts anticipating a much tighter balance ahead. They see a surplus of just 10,000 metric tons in 2025 followed by a 1,500 metric ton deficit in 2026.

This sentiment was echoed by Adam Webb, head of battery raw materials at Benchmark Mineral Intelligence, during a market overview at the Benchmark Summit, held in Toronto in early March.

“We’re expecting this year for the market to remain in surplus,” he said. A 2025 surplus paired with high inventory levels from the previous two years is expected to impede price movement.

“Our expectation for this year is that lithium carbonate prices will remain about where they are, US$10,400 per metric ton,” Webb told attendees. “But if we look further ahead, from 2026 onwards, that market is switching into the deficit, albeit quite small to start with, and that will end up being supportive of prices.”

As Webb explained, prices need to find some support because current levels are unsustainable.

“I think we’ve more or less hit the bottom,” he said told the audience while pointing to a chart showcasing the all-in sustaining cost curve for lithium in 2025. Webb added that at the current price level of US$10,400 per metric ton, ‘about a third of the industry currently is not profitable. So prices can’t move much lower, because that’s going to put even more production under pressure, and you can see more supply come offline.’

Stifled, stranded and shuttered supply

The sharp decline in lithium prices has already compelled various lithium-mining companies to curtail production, delay expansion plans and implement workforce reductions.

In August 2024, Pilbara Minerals (ASX:PLS,OTC Pink:PILBF) reported an 89 percent year-on-year drop in annual net income and deferred plans to create the world’s largest lithium mine. The company also said it would reduce its capital expenditures to between AU$615 million and AU$685 million for the current financial year.

This past February, Albemarle (NYSE:ALB) halted expansion plans for its Kemerton plant in Western Australia and mothballed its Chengdu lithium hydroxide plant in China, citing prolonged low prices. The company also reduced its 2025 capital expenditure forecast by US$100 million, to US$700 million to US$800 million.

Additionally, Mineral Resources (ASX:MIN,OTC Pink:MALRF) mothballed its Bald Hill operations in December, and Liontown Resources (ASX:LTR) has scaled back its production targets for the Kathleen Valley lithium project in response to prolonged low lithium prices. The company now plans to reach a production rate of 2.8 million metric tons per year by the end of its 2027 fiscal year — pushing back its earlier goal of hitting 3 million metric tons by Q1 2025.

The broad market weakness in the lithium sector has also led to some deals.

In early March, mining major Rio Tinto (ASX:RIO,NYSE:RIO,LSE:RIO) completed its US$6.7 billion purchase of Arcadium Lithium. Through the deal, Rio Tinto has acquired several lithium carbonate projects in Argentina, as well as lithium hydroxide production capacity in the US, Japan and China. The company is aiming to increase its lithium carbonate equivalent production capacity to over 200,000 metric tons annually by 2028.

Also in March, Lithium Americas (TSX:LAC,NYSE:LAC) secured a US$250 million investment from Orion Resource Partners to support the development and construction of Phase 1 of its Thacker Pass lithium project in Nevada.

The funding package is expected to fully cover project and corporate costs through the construction phase, with completion of Phase 1 targeted for late 2027.

Earlier in the quarter, Standard Lithium (TSXV:SLI,NYSE:A:SLI) and Equinor (NYSE:EQNR) announced that their joint venture, SWA Lithium, had received a US$225 million grant from the US Department of Energy. The funding is earmarked for the construction of Phase 1 of the South West Arkansas lithium project.

Battery sector growth key to long-term lithium recovery

The largest factor behind lithium market oversupply has been the gap between projected and actual EV demand. Ambitious projections about EV adoption through the 2020s led producers to ramp up lithium output in anticipation of a surge in EV sales; however, EV adoption has been slower than expected, leading to excess supply.

“(In 2024), EV growth was slower than had been expected, but actually it still grew significantly globally,” said Webb. “But there were really important regional differences in that growth.” He went on to explain that China’s EV market saw a 36 percent year-on-year increase, with plug-in hybrids making up 40 percent of sales.

In contrast, EV sales in Europe declined by 4 percent, largely due to subsidy cuts in Germany. North America experienced 8 percent growth, albeit from a smaller base, Webb added.

“China will remain the biggest growth market (over the next decade),” he said. “But in the EU we’re expecting six times the number of sales in 10 years, and here in North America seven times.”

The lithium market is also expected to benefit from higher energy storage system demand, which is set to increase from US$251.14 billion in 2024 to US$271.73 billion in 2025. In 2024, the energy storage system segment contributed to a 28 percent year-on-year increase in battery demand, according to the Benchmark analyst.

“Looking out 10 years, it’s still quite a rosy picture, really — a 15 percent CAGR out to 2035 — and that translates to more demand for the raw materials that go into these batteries,” said Webb.

Additionally, this expansion has been impacted by economies of scale, which have sent battery cell prices to record lows — they averaged US$73 per kilowatt-hour in 2023 and hit US$63.50 kilowatt-hour in December.

Reduced battery costs could offer long-term support to the demand narrative by helping to drive down the cost of EVs and energy storage systems.

Energy storage demand a potential major catalyst

The rapid growth in energy storage was also underscored by Ernis Ortiz, president and CEO of Lithium Royalty (TSX:LIRC,OTC Pink:LITRF) and a panelist at the Benchmark Summit.

When asked if there will be enough future supply to meet demand projections, Ortiz was optimistic.

“I do think there will be enough supply, but at a price,” he said.

“So you need prices to rise in order to incentivize that new supply response.”

He went on to explain that in 2025, lithium supply growth is projected at approximately 17 percent, but with energy storage demand potentially doubling, that sector alone could absorb the expected supply increase. When combined with rising EV demand, much of the additional supply may be consumed, potentially reducing inventory levels by year end.

“Then you probably incentivize some of the care-and-maintenance assets,” said Ortiz. “But then you look at 2026 and 2027, and there’s a very limited investment for greenfield assets.”

Long-term lithium price outlook

Benchmark has pegged the CAGR of the lithium market at 12 percent over the next 10 years, although this could be impeded due to the amount of project delays and shutterings. In the long term, the metals consultancy and pricing firm is also projecting a significant gap between projected demand and currently financed supply.

Webb explained that unfunded projects and future yet-to-be-identified greenfield developments together represent 1.3 million metric tons of lithium carbonate equivalent that the market will need.

“For those projects to be incentivized, prices have to rise,” said Webb. “Our long-term incentive price for lithium is US$21,000 per metric ton. So prices will have to rise in the longer term for lithium.”

Markets brace for further impact

The combined losses across major markets pushed the Nasdaq Composite into bear market territory on Friday (April 4) after the index registered a 20 percent decline.

Concerns that S&P 500 would follow suit mounted on Monday.

CNBC’s Jim Cramer likened the market selloff to “Black Monday,” noting the similarities to the 1987 market crash.

Analysts warn that further volatility is likely if inflation data due later this week exceeds expectations.

Even safe-haven asset gold felt the pressure as it fell below US$3,000 an ounce for the first time since mid-March.

The high-pitched market uncertainty highlights the far-reaching consequences of the sweeping new tariffs and China’s swift retaliation, which together have reignited fears of a global trade war.

With a 10 percent baseline duty on all imports as well as double-digit targeted tariffs, investors are recalibrating their strategies in real time, pulling back from risk and pivoting toward safe-haven assets.

A ‘precision strike’ on US defense capabilities

Mark A. Smith, CEO of NioCorp Developments (NASDAQ:NB), a company working to create domestic supply of critical minerals in the US, called China’s actions a ‘precision strike’ against the Pentagon’s supply chains.

In a press release, he emphasized the far-reaching impact of rare earths export curbs on US defense technologies.

‘This is a precision strike by China against Pentagon supply chains that enable our most powerful weapons and defense systems,’ Smith said on Friday. ‘These aren’t just metals — they’re bottleneck elements, and without them, much of the Pentagon’s advanced hardware risks slipping from superiority to obsolescence.’

The rare earth elements targeted by China are not just vital for defense, but are integral to other industries too. From renewable energy technologies to high-end electronics, the list of affected products is extensive.

NioCorp began to explore the possibility of recycling rare earths last year, alongside the feasibility of recycling post-consumer rare earth magnets to reduce reliance on Chinese imports.

As the US military continues to modernize its technology, including hypersonic weapons and advanced satellite systems, the lack of access to these elements could have long-term supply implications.

This latest round of trade tensions comes in the wake of US President Donald Trump’s aggressive tariff policies and the imposition of a 54 percent tariff on Chinese imports. In March, Trump invoked wartime powers under the Defense Production Act to address the nation’s reliance on foreign critical minerals.

The US Department of Defense has already been involved in efforts to develop domestic rare earths production capabilities, and this move from China may serve to accelerate those initiatives.

China has increasingly wielded its dominance over critical materials as a weapon in trade war situations with the US in the past few years. Most recently, the country implemented similar curbs on minerals like gallium, germanium and graphite — all of which are key to high-tech and defense applications.

While the recent export restrictions will not result in an outright ban, they will subject shipments to greater scrutiny, with controls targeting exports of materials used in both civilian and military applications.

Growing calls for domestic production

The potential economic fallout from China’s restrictions is substantial. Its dominant role in the global rare earths market means that the US and its allies have few alternatives when it comes to sourcing these materials.

Ucore Rare Metals (TSXV:UCU,OTCQX:UURAF), a company focused on developing North American rare earths processing facilities, has stressed the need to establish a more independent and resilient supply chain.

Pat Ryan, CEO of Ucore, which is developing its proprietary RapidSX rare earths refining technology, acknowledged the urgency of addressing these vulnerabilities.

‘China’s recent announcement highlights the urgent need for a robust and independent rare earth supply chain in North America,’ Ryan maintained in a Friday press release.

‘Ucore’s RapidSX technology offers a transformative solution to this challenge, and we are committed to advancing our strategic initiatives to ensure a stable and secure supply of critical rare earth elements.’

Ucore has secured key funding for its initiatives, including a US$4.28 million deal with the Canadian government to demonstrate the commercial viability of its technology, and a US$4 million contract with the US Department of Defense.

The company is also working to develop a rare earths processing facility in Louisiana, which could significantly reduce North America’s reliance on foreign sources.

Bitcoin and Ethereum price update

At the time of this writing, Bitcoin (BTC) has continued its skid to drop to US$76,178.35, down 4.6 percent in 24 hours. The day’s range has brought a low of US$74,604.47 and a high of US$82,669.72.

Bitcoin performance, April 7, 2025.

Chart via TradingView

Bitcoin’s downturn is largely attributed to escalating global trade tensions following President Donald Trump’s announcement of new tariffs.The resulting market uncertainty has led to a broader sell-off in risk assets, including cryptocurrencies.

Additionally, China’s retaliatory tariffs have intensified fears of a trade war, further shaking investor sentiment.

Ethereum (ETH) is priced at US$1,493.12, a 12.7 percent free fall over the past 24 hours. The cryptocurrency reached an intraday low of US$1,431.73 and a high of US$1,764.84.

Altcoin price update

• Solana (SOL) is currently valued at US$100.50, down 8.7 percent over the past 24 hours. SOL experienced a low of US$96.70 and a high of US$115.25 on Monday.

• XRP is trading at US$1.76, reflecting a 10.0 percent decrease over the past 24 hours. The cryptocurrency recorded an intraday low of US$1.65 and a high of US$2.08.

• Sui (SUI) is priced at US$1.82, showing a 5.8 percent decrease over the past 24 hours. It achieved a daily low of US$1.75 and a high of US$2.10.

• Cardano (ADA) is trading at US$0.5445, reflecting a 8.7 percent decrease over the past 24 hours. Its lowest price on Monday was US$0.5157, with a high of US$0.6279.

Crypto news to know

Bitcoin slides below US$75,000 as tariff chaos spooks markets

Bitcoin dropped over 5 percent on Monday (April 7) morning, briefly dipping below US$75,000 for the first time since Donald Trump’s re-election in November, as sweeping US tariffs and China’s retaliation triggered a market-wide selloff.

Ether plummeted over 10 percent to levels not seen since March 2023, while altcoins like XRP, Solana, and Cardano also posted heavy losses.

The total crypto market cap fell by 11 percent to US$2.5 trillion, wiping out nearly all gains made since Trump’s victory.

Traders had hoped a crypto-friendly administration would usher in tailwinds, but rising global tensions have proved overwhelming.

Analysts say the carnage could continue, with options markets flashing signs of sustained bearish pressure and over US$1.2 billion in long liquidations recorded in just 24 hours.

Strategy to log US$5.9B unrealized loss under new Bitcoin accounting rule

Michael Saylor’s Strategy (NASDAQ:MSTER) (formerly MicroStrategy) announced it will register an eye-watering US$5.9 billion unrealized loss in Q1 after adopting fair-value accounting for its Bitcoin reserves—a policy shift that reflects BTC’s steep price pullback this year.

The loss comes after a fresh buying spree in early 2025, which left the firm with roughly US$1 billion in paper losses on recent acquisitions alone.

Yet paradoxically, the company will also log a US$13 billion boost to retained earnings due to the new accounting standards, highlighting the volatile nature of being Wall Street’s leading BTC proxy.

Strategy’s stock tumbled as much as 14 percent Monday, raising new questions about whether Saylor’s “buy-and-hold forever” ethos can withstand institutional scrutiny in a more volatile macro climate.

Hong Kong greenlights staking for licensed crypto exchanges under strict new rules

In a major step toward institutionalizing crypto, Hong Kong’s Securities and Futures Commission (SFC) unveiled formal guidelines allowing licensed exchanges and funds to offer staking services, provided strict custodial and disclosure requirements are met.

Staking, crucial for securing Proof-of-Stake (PoS) networks and generating passive returns, had previously been a regulatory gray area in the city.

Under the new rules, exchanges must retain direct control of client assets, explicitly barring third-party delegation, and provide full transparency on risks, fees, and lock-up periods.

The move reflects Hong Kong’s ambition to rival other financial hubs and attract global digital asset firms amid the regulatory vacuum in jurisdictions like the US, where staking remains under scrutiny from the SEC.

South Korea’s US$890B pension fund to adopt blockchain for fund operations and oversight

South Korea’s National Pension Service (NPS), one of the world’s largest public pension funds, is moving to incorporate blockchain technology into its operational infrastructure, according to a recent Seoul Economic Daily report.

With over US$800 billion in assets under management, the NPS aims to use blockchain to improve tracking of transactions, client withdrawals, and investment flows, especially for foreign clients.

Though the fund is not directly investing in crypto, it has taken equity positions in firms like Coinbase and Strategy, signaling long-term confidence in the industry’s underlying technology.

The NPS initiative aligns with the nation’s growing retail enthusiasm for crypto—South Korea now boasts more than 16 million crypto investors, a surge that has accelerated since Trump’s 2024 electoral win sparked hopes of a more favorable global crypto environment.

United States focused Cleantech company Carbonxt Group Ltd (ASX:CG1) (Carbonxt or the Company) is pleased to announce that our Managing Director, Warren Murphy, will be presenting at the Ignite Investment Summit in Hong Kong on Thursday, March 27 at 12:00 PM HK time. Warren will showcase Carbonxt’s cutting-edge carbon solutions, highlighting how the Company is driving sustainability and delivering value through advanced technology and eco-friendly innovation.

Carbonxt Group Limited is excited to be part of the Ignite Summit, a premier event that brings together innovative companies, investors, and industry leaders from across the globe.

Click here for the full ASX Release