Gold prices weakened alongside other safe-haven assets, particularly the Japanese yen, as a U.S. court ruling on Wednesday lifted market risk sentiment.
The U.S. Court of International Trade ruled that former President Donald Trump exceeded his authority in proposing sweeping tariffs against major global economies. The court reaffirmed that only Congress has the final say on broad trade tariffs.
The Trump administration was given a 10-day deadline to comply with the ruling. However, the White House immediately appealed the decision.
Market risk appetite strengthened on bets that Trump might not be able to push forward with his tariff agenda, which had been a significant source of uncertainty in 2025. Still, analysts cautioned that the tariffs are likely to remain in effect during the appeals process, potentially adding further legal uncertainty.
U.S. stock markets closed lower on Wednesday, dragged down by losses in essential materials, public institutions, and energy sectors. The Dow Jones fell 0.58%, the Nasdaq dropped 0.51%, and the S&P 500 declined 0.56%.
Oil Prices Rise on Court Ruling, Supply Data
Oil prices rose in Asian trading on Thursday, buoyed by improved sentiment following the court’s ruling against Trump’s tariff expansion.
Further support came from an unexpected move by OPEC+, which chose not to increase its production share against market expectations. Additionally, signs of a steep drop in U.S. crude inventories triggered hopes for tighter supply.
Focus now shifts to OPEC+’s upcoming decision on July output, with markets anticipating the group will maintain current production levels.
Despite Thursday’s gains, oil prices remain sharply down in 2025 due to ongoing demand concerns and slower economic growth.
Data from the American Petroleum Institute showed U.S. crude inventories dropped by 4.24 million barrels last week, contrary to expectations for a 1 million barrel increase.
Such API data often precedes a similar trend in official government stockpile data, expected later on Thursday.
The significant drawdown in inventories has reignited optimism that U.S. fuel demand remains strong despite macroeconomic uncertainty.
Outlook & Upcoming Data
Markets are also awaiting more U.S. economic indicators on Thursday, particularly a revised GDP reading for Q1. Preliminary data showed a 0.3% contraction, heightening fears of global demand weakness.
Conclusion:
While gold and safe havens are under pressure, oil is finding new life through bullish supply signals and improved risk sentiment. Yet, the legal wrangling around Trump’s tariffs and a fragile U.S. economy keep markets on edge. Investors should stay alert as more data unfolds.
