Gold futures in New York experienced a rise after a report indicated that imports of one-kilo bullion bars might be subject to US levies. This belief contradicts earlier assumptions that gold would remain free from import tariffs.
One-kilo gold bars are predominantly traded on Comex and make up most of Switzerland’s exports to the US. Following the report, the New York futures saw a premium over London spot, unseen since the Covid pandemic, with December contracts exceeding $100 above global benchmarks.
White House Executive Order Speculation
However, reports suggest the White House may clarify matters with an executive order, indicating that gold bar imports might not incur tariffs. This development temporarily eased the premium.
We are seeing major uncertainty in the gold market as of August 11, 2025, driven by conflicting reports on US tariffs. The key signal for traders is the spread between New York and London gold prices, which remains unusually wide. That premium on December Comex futures, after spiking over $100, is still sitting near $45, a clear sign of market stress.
This environment suggests a direct play on the New York-London spread itself. Traders who believe the White House will kill the tariff idea should consider selling the premium, by shorting Comex futures while buying London spot gold. Conversely, those betting the tariffs stick would do the opposite, anticipating the spread will widen again.
The heightened uncertainty has caused gold’s implied volatility to surge, with the CBOE Gold Volatility Index (GVZ) climbing over 15% in the last week. This means options strategies, like buying a straddle, could be profitable regardless of the final tariff decision. Such a trade profits from a large price move in either direction, which seems likely.
Market Dislocation Lessons
We are reminded of the market dislocation in March 2020, when pandemic-related flight groundings broke the physical supply chain and caused a similar premium spike. Back then, the spread eventually collapsed as logistics were sorted out. Today’s issue is policy-driven, not logistical, making the timeline for a resolution dependent on Washington’s unpredictable schedule.
With the White House yet to issue a definitive executive order, the market is hanging on every rumor. Last week’s non-committal statement from a junior trade official only added to the confusion, causing the premium to fluctuate wildly. This government indecision is the main source of the ongoing risk and opportunity.
Therefore, we are watching options contracts that expire in the next several weeks, specifically the September and October contracts. These instruments are best positioned to capture a sudden price realignment once a final decision on the tariffs is announced. Traders should remain nimble as the official clarification could come at any moment.
