The price gap between US and international gold markets is returning to normal after months of disruption, as concerns about potential tariffs on gold imports have begun to ease.
In recent months the difference between New York’s Comex futures and the London spot market widened dramatically. That gap has now narrowed to roughly $10 per ounce, down from January’s peak near $60. This is much closer to the typical spread of just a few dollars that usually separates the two markets. During the period of wide divergence, traders funneled gold into the United States to capture the higher US prices, creating a strong—but now waning—arbitrage incentive.
Comex inventories have climbed to about 39.5 million troy ounces, a four‑year high and a level that approaches the total of outstanding short positions on the exchange. Meanwhile, borrowing costs for gold in London have fallen from their recent record highs back toward negligible levels. Those changes have helped alleviate the supply bottlenecks that arose when market participants withdrew metal from both commercial vaults and Bank of England facilities to ship stock to the US.
Bart Melek of TD Securities notes that the trade pushing metal to the US appears to be “getting exhausted.” He points out that American vaults now hold an unusually high proportion of kilo bars, metal typically sold into Asian retail markets. Although future policy moves—such as tariff decisions—could still affect prices, the enlarged inventories in the US provide a buffer that may help stabilize global pricing dynamics.