Bullion traded near $2,840 an ounce on Friday, down for a second straight session. That’s after Trump said Thursday that tariffs on Canada and Mexico were set to be implemented on March 4, and he would impose additional levies on Chinese imports. The US currency climbed, making the dollar-priced precious metal less appealing to foreign investors.

The latest developments on the tariff front weighed on investor appetite and helped drive volatility higher across asset classes, thereby triggering a broad retreat among leveraged funds that are forced to reduce exposure when volatility jumps, according to Ole Hansen, head of commodities strategy at Saxo Bank A/S. The price correction in gold was “overdue” following an eight-week run of gains, he added. 

Traders are also digesting the latest data that showed the Fed’s preferred measure of underlying inflation offered some relief after a string of reports suggested price pressures were heating up. 

Fed officials have indicated they need to see a meaningful easing in inflation before they begin lowering interest rates again, especially when they factor in the uncertainty around how Trump’s policies will impact prices. Lower rates are positive for non-interest bearing bullion.

Bullion’s first weekly decline this year has come after increasing haven demand helped push prices to a record high of $2,956.19 on Monday. Widespread uneasiness about the impact of Trump’s tariffs on US inflation, trade, the global economy and geopolitics have underscored bullion’s role as a store of value in uncertain times. 

Spot gold fell 1.3% to $2,840.67 an ounce as of 10:43 a.m. in New York, on track for a weekly loss of 3.2%. The Bloomberg Dollar Spot Index gained 0.1%, following its 0.6% spike in the previous session. Silver, platinum and palladium all declined.