Gold prices slipped from record highs Friday, with risk sentiment boosted after U.S. President Donald Trump signaled an easier stance to trade negotiations with China.
At 10:20 ET (14:20 GMT), Spot gold fell 2.3% to $4,226.43 per ounce, after briefly touching a new peak of $4,379.29 earlier in the session. U.S. Gold Futures for December slipped 1.5% to $4,237.69 an ounce.
Sentiment boosted by Trump’s trade stance
President Donald Trump indicated Friday that the high tariffs imposed on Chinese goods will not remain in place long-term, signaling a potential shift in U.S.-China trade relations ahead of his upcoming meeting with Chinese President Xi Jinping.
"It’s not sustainable," Trump said in an interview with Fox Business when asked whether the current tariff levels could remain. "It could stand, but they forced me to do that."
Trump revealed he will meet with Xi in South Korea in two weeks, suggesting the encounter could lead to trade negotiations. "I think we’ll be fine with China," Trump stated during the interview, a clip of which aired Friday.
The comments come after Trump threatened last week to impose additional 100% tariffs on Chinese goods starting November 1, along with other trade measures against China. These threats were in response to Chinese restrictions on rare earth mineral exports.
This news has boosted general sentiment, to the detriment of the safe haven metal.
Gold on track for another winning week
That said, the yellow metal has now gained over 5% this week, winning for the ninth consecutive week, and extending its record-breaking rally to a fifth straight session.
Gold is now approaching the $4,400 per ounce mark, as growing expectations of a Federal Reserve rate cut this month and renewed U.S.-China tariff tensions drove investors toward safe-haven assets.
Traders are pricing in a strong likelihood of a Fed rate cut in October as economic data continues to point to cooling inflation and slowing growth.
Fed Chair Jerome Powell earlier this week adopted a more dovish tone, flagging downside risks in the labor market and hinting that the central bank would remain data dependent and proceed on a “meeting-by-meeting” basis.
Support for easing is growing within the Fed. Governor Christopher Waller on Thursday backed a 25 bps cut in October, citing signs of persistent weakness in the labor market.
Meanwhile, newly appointed Fed Governor Stephen Miran has championed a more aggressive easing path.
Beyond rate expectations, gold was supported by robust central bank purchases, inflows into gold ETFs, and elevated demand in Asia. In India, the elevated festival season buying also boosted demand.
Other metal markets dip
Other precious and industrial metals traded lower on Friday, even as the U.S. dollar remained on the back foot.
Silver Futures dropped 5.1% lower to $53.570 per ounce, while Platinum Futures dropped 7.3% to $1,628.50/oz.
Benchmark Copper Futures on the London Metal Exchange slipped 0.7% to $10,562.95 a ton, while U.S. Copper Futures declined 0.7% to $4.9537 a pound.
Source :
https://www.investing.com/news/commodities-news/gold-continues-record-run-nears-4400oz-on-dovish-fed-signals-safehaven-rush-4293706
