A dramatic surge in physical gold demand is reshaping precious metals markets as traders scramble to secure bullion ahead of President Trump’s potential 25% tariffs. This has pushed gold prices to an all-time highs and creating notable price disparities between London and New York markets, with spreads reaching up to $50 per ounce for gold and 90 cents for silver. The situation has become particularly acute in the last two weeks, with Comex warehouse stocks jumping 30% to 30.4 million ounces as traders move to protect themselves against possible tariff implementations. The rush has created significant pressure on traditional market dynamics, with London’s bullion market experiencing strain as physical gold flows to New York. While the Bank of England maintains there is no shortage of gold, they acknowledge longer wait times for vault transfers due to unprecedented demand. Market experts suggest this could lead to a potential short-covering event, given that paper trades significantly outnumber physical holdings. The situation is particularly concerning for silver, which relies heavily on imports from Mexico and Canada. This market upheaval reflects broader uncertainty about the scope of upcoming tariffs and their potential impact on precious metals prices, with some analysts suggesting gold prices could reach $3,500 if tariffs are implemented.