Gold prices dipped slightly on Tuesday as traders focused on U.S.-China trade talks, which could ease tensions and stimulate the global economy, potentially reducing demand for safe-haven assets. Additionally, a stronger U.S. dollar added pressure on gold prices.
As of 1402 EDT (1802 GMT), spot gold was down 0.1% at $3,324.55 an ounce, while U.S. gold futures settled 0.3% lower at $3,343.40. The dollar index rose by 0.2% against major currencies, making gold more expensive for non-dollar holders.
David Meger, director of metals trading at High Ridge Futures, noted that gold’s recent decline was driven by optimism surrounding U.S.-China trade talks. U.S. Commerce Secretary Howard Lutnick confirmed that negotiations were progressing well and would continue through the day in London, aiming to resolve disputes over export controls. A successful trade agreement could reduce gold’s appeal as a safe-haven asset, typically sought during times of geopolitical and economic uncertainty.
Market participants are closely monitoring the developments, with some expecting a pullback in gold prices to around $3,100 an ounce. Bob Haberkorn, senior market strategist at RJO Futures, emphasized the uncertainty, saying investors are waiting to see the outcomes of the ongoing talks.
Investors are also awaiting the U.S. Consumer Price Index data due on Wednesday.
Meanwhile, other precious metals also saw declines. Spot silver dropped 0.5% to $36.53 per ounce, platinum eased 0.5% to $1,213.08 after reaching its highest level since May 2021, and palladium fell 1.2% to $1,061.85. Alexander Zumpfe, a precious metals trader at Heraeus Metals Germany, explained that platinum’s recent rally was driven by supply concerns, speculative interest, and a broader rise across the precious metals sector. Palladium, on the other hand, faced weaker demand and less investment appeal.
U.S. stocks ended the day higher as investors grew optimistic about the potential positive outcome of U.S.-China trade talks.
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