Gold's stubborn sideways movement near $3,300 per ounce signals the market's anxious wait for clarity on interest rates and trade policies, according to Joe Cavatoni, Chief Market Strategist for North America at the World Gold Council (WGC). The recent shock move imposing U.S. tariffs on copper imports serves as a stark reminder: gold could face similar trade barriers down the road. "When it comes to tariffs targeting minerals vital for national defense or energy, absolutely anything could happen," Cavatoni emphasized. "This administration has made reducing foreign dependence on critical assets a cornerstone policy."

While the WGC remains cautiously optimistic about gold's current tariff immunity, Cavatoni stressed the reprieve might be temporary. "Make no mistake—all possibilities remain open," he warned, noting the postponed August tariff deadline merely buys time. Gold's classification as a monetary metal rather than a strategic mineral currently shields it, as governments historically exclude it from critical mineral lists. "Gold functions primarily as savings—in portfolios and central bank reserves—not in defense systems or telecom infrastructure," Cavatoni explained.

Yet physical gold flows between nations could trigger intervention. "Cross-border metal movements create logistical complexities that might prompt tariff measures," Cavatoni cautioned, adding that critical uncertainties linger—including whether tariffs would target raw ore or refined products, and how valuations would be calculated. "Nothing’s set in stone. The situation remains fluid."

The prolonged price consolidation reflects market confusion over competing drivers. Investors wrestle with assessing endless trade negotiation updates and potential ripple effects. "Tactically, gold responds to momentum shifts and opportunity costs," Cavatoni noted. "A Fed rate cut would temporarily boost gold’s appeal, but traders now obsess over whether momentum alone can spark movement." The WGC takes a longer view, awaiting transformative catalysts. "We’ve seen a remarkable 26% surge this year—far exceeding typical 8% annual returns—but sustained breakout requires clearer signals on economic direction, Fed actions, and dollar performance."

Supply dynamics remain stable, with global output growing steadily at 1%-2.5% annually. Major miners continue outperforming despite industry consolidation. Cavatoni spotlighted artisanal mining, which contributes 20% of global supply: "We’re actively monitoring this sector for regulatory risks while pushing standardization."

Central banks dominate demand, absorbing 20%-25% of annual consumption over recent years—a net buying streak spanning 15 years. A WGC survey revealed 95% of central banks view gold as strategically essential, with half planning increased reserves within 12 months. "Central banks prioritize stability in reserve assets, ensuring their sustained market presence," Cavatoni concluded. Upcoming Q2 data in the Gold Demand Trends report will likely confirm "another robust quarter for institutional buying."