Gold prices slipped on Monday as positive US-China trade discussions alleviated market fears over tariffs, leading investors to shift from safe-haven assets towards riskier investments.
Spot gold XAU= was down 1.4% at $3,277.84 an ounce, as of 0624 GMT. US gold futures lost nearly 2% at $3,279.20.
The US and China ended high-stakes trade talks on a positive note on Sunday, with US officials touting a “deal” to reduce the US trade deficit, while Chinese officials said they had reached an “important consensus”.
Chinese Vice Premier He Lifeng said a joint statement would be released in Geneva on Monday.
The US and China imposed tit-for-tat tariffs on each other last month, triggering a trade war that fuelled fears of global recession.
The US will be left with higher tariffs once the dust settles from President Donald Trump’s trade negotiations, a majority of the current and former Trump advisers Reuters spoke to said.
Gold, traditionally seen as a hedge against economic and political uncertainties, thrives in a low-interest rate environment.
“The dollar index has advanced as the Trump administration touted progress in trade negotiations with China following negotiations over the weekend in Switzerland which weighed on gold prices,” said Jigar Trivedi, senior commodity analyst at Reliance Securities.
