By Joe Wallace
If you landed on a flight from Europe to JFK recently, you might have been an unwitting participant in a high-stakes, high-altitude trade by gold dealers at JPMorgan Chase JPM 0.10%increase; green up pointing triangle.
President Trump’s threatened tariffs on Europe have thrown precious-metal markets into disarray. Gold prices have been driven to record highs, and a yawning gap has opened in the value of the yellow metal in its two trading hubs, New York and London.
Gold is, for the moment, worth substantially more in Manhattan than in the U.K. capital, sparking the biggest trans-Atlantic movement of physical bars in years. Traders at major banks are racing to yank gold from vaults deep below London’s medieval streets and from Swiss gold refineries and ferry them across the ocean.
The cheapest way to transport such a valuable commodity safely: the cargo hold of commercial planes.
Gold futures in New York have risen 11% this year, closing Wednesday at $2,909 a troy ounce, and some analysts project they could soon hit $3,000 a troy ounce for the first time. Many investors view gold as a haven at times of heightened risk. In London, though, prices per troy ounce have been about $20 lower since early December—an unusually deep discount, which traders said reflects potential tariffs at the U.S. border.
A handful of banks with access to huge supplies of gold—including JPMorgan and HSBC Holdings HSBA —are in pole position to cash in on the disconnect, according to market participants and analysts.
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