Gold prices took a notable hit today as investors redirected their interest toward riskier assets, spurred by a pivotal court ruling on U.S. President Donald Trump’s tariff strategy. This shift in sentiment added further pressure to an already weakening gold market, as demand for traditional safe-haven assets continued to diminish.

Court Ruling Eases Uncertainty, Boosts Market Confidence

The U.S. Court of International Trade issued a significant decision that effectively curtailed Trump’s sweeping authority to impose trade tariffs without congressional oversight. This ruling, which grants a 10-day compliance window, marked a victory for trade stakeholders seeking more predictable policy frameworks. The White House swiftly appealed the decision, but investors appeared to interpret the ruling as a sign that future trade policies may face stricter legislative scrutiny—an outcome that could reduce economic unpredictability.

Following the court’s announcement, equities and other risk-on assets rallied, while traditional hedges such as gold and the Japanese yen weakened. The decision triggered optimism that trade tensions could ease, prompting a surge in the U.S. dollar and reducing the appeal of gold as a protective investment.

Gold Continues Weekly Slide as Dollar Strengthens

The bullion market had already been under pressure throughout the week following Trump’s controversial decision to raise tariffs on European goods. This move paradoxically stimulated risk appetite among investors, leading to a sell-off in safe-haven assets like gold. On top of that, the U.S. dollar experienced a three-day rebound, adding even more downward pressure on gold prices.

By the end of Wednesday’s trading session, spot gold had declined to $3,273.19 per ounce. Meanwhile, gold futures scheduled for August delivery fell below the $3,300 threshold. These declines represent a 2.5% drop over the past week, with traders engaging in widespread profit-taking after gold reached record highs the week before.

Risk-On Sentiment Also Hits Japanese Yen

In a correlated move, the Japanese yen—another traditional safe-haven—also depreciated as global investors embraced riskier investments. The court ruling injected renewed confidence in the global market environment, weakening the allure of conservative asset holdings.

Metals Mixed as Markets Await U.S. Economic Data

While gold suffered losses, other metals exhibited mixed performance. Silver futures gained 0.5% to reach $33.33 per ounce, while platinum saw a modest 0.2% increase to $1,078 per ounce. Copper also recorded slight gains across both the London Metal Exchange and U.S. trading floors. LME copper futures climbed 0.2% to $9,586 per ton, and U.S. copper futures mirrored the same gain to hit $4.95 per pound.

Market analysts are now turning their attention to upcoming U.S. economic data, particularly a revised gross domestic product (GDP) reading for the first quarter. In April, a surprise contraction in GDP had driven gold prices upward, but any positive revision could further reduce gold’s appeal.

Nigeria Urged to Adopt Partial Gold Reserve Strategy to Support Naira

In a related development on the local front, the Chartered Institute of Treasury Management has called on the Central Bank of Nigeria (CBN) to consider backing the Naira with partial gold reserves. Speaking at a recent policy roundtable, Registrar Adedoyin Olumide proposed a strategic framework for enhancing monetary stability and investor confidence through gold-backed initiatives.

Though Nigeria currently does not operate under a gold standard, Olumide suggested that a hybrid model could be implemented. The proposed policy would involve the CBN directly purchasing gold from licensed local miners, thereby linking the national currency to tangible reserves and potentially strengthening the Naira’s credibility.

Formalizing Nigeria’s Artisanal Mining Sector

Olumide further advocated for the formalization of Nigeria’s vast artisanal mining sector, which remains largely unregulated. Licensing, training, and regulatory reforms would allow for safer and more productive mining operations. With technical support from international refineries and capital investment in mining technologies, Nigeria could build a more resilient and sustainable gold ecosystem.

Such reforms would support the Federal Government’s broader objective under the National Gold Purchase Program (NGPP), which aims to build reserves, enhance economic stability, and boost public confidence in the Naira.

FG Records First Commercial Gold Transaction in Local Currency

Nigeria recently marked a milestone by executing its first commercial gold transaction using local currency under the NGPP. Fatimah Shinkafi, Executive Secretary of the Solid Minerals Development Fund, emphasized that the move aims to align Nigeria with global best practices, where countries purchase gold with local tender to fortify their monetary systems.

Shinkafi reiterated that this policy supports the Ministry of Solid Minerals Development’s goal of expanding Nigeria’s role in the global precious metals market. “We are leveraging our abundant mineral resources to not only diversify revenue but to also establish economic resilience,” she stated.

Nigeria-South Africa Agreement Signals Mining Sector Growth

Adding to the momentum, Nigeria’s Minister of Mines announced a landmark partnership with South Africa to foster mining collaboration. The bilateral agreement aims to enhance technical cooperation in areas such as mineral mapping, exploration, and investment promotion.

Nigeria holds an estimated 200 million metric tons of gold reserves, spanning key mineral-rich states including Zamfara, Oyo, Osun, Kogi, Kwara, Kaduna, Bauchi, and Abia. These untapped resources represent significant economic potential, especially if harnessed through responsible and transparent mining practices.

Nigeria-South Korea Pact to Boost Geological Mapping and Data Collection

In a further sign of growing international interest, Nigeria has also entered discussions with South Korea to collaborate on geological mapping and mineral data acquisition. These initiatives are seen as crucial steps in unlocking the full value of Nigeria’s mineral wealth, which includes not just gold but also limestone, lithium, iron ore, and zinc—amounting to at least 23 commercially viable mineral deposits.

Final Thoughts: Risk Appetite Grows as Precious Metals Retreat

This week’s drop in gold prices highlights the dynamic interplay between geopolitical decisions, economic sentiment, and investor behavior. While the bullish dollar and easing trade concerns have reduced the immediate appeal of gold, underlying uncertainties—including ongoing legal appeals and macroeconomic data—could still reshape market conditions in the weeks ahead.

For Nigeria, the situation presents both a cautionary tale and an opportunity. As global investors reallocate portfolios in response to shifting trade dynamics, Nigeria’s gold-backed currency proposal and bilateral mining agreements could lay the foundation for long-term monetary and resource stability.

As central banks and investors around the world reassess their strategies, gold may yet reclaim its safe-haven status. However, for now, the bullion market remains under pressure, and stakeholders will be watching closely for the next round of economic signals.