Gold holds heavy loss as markets latch onto US-China optimism

[Pelican Press 0]

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Gold holds heavy loss as markets latch onto US-China optimism

Gold steadied after a sharp selloff as a major de-escalation in US-China trade tensions hurt demand for havens.

Bullion traded near $US3237 ($5076) an ounce – after losing 2.7 per cent on Monday – with investors betting on a recovery in stocks and riskier assets.

The world’s biggest economies agreed to temporarily lower tariffs, with the US slashing duties on ******** products to 30 per cent from 145 per cent for a 90-day *******, while Beijing dropped its levy on most goods to 10 per cent.

The US dollar rose the most since a post-election rally in November, while Treasury yields climbed – both acting as headwinds for gold. Traders now see just two rate cuts from the Federal Reserve in 2025 in a reset of inflation expectations. That reduces bullion’s appeal as the metal pays no interest.

Gold remains almost a quarter higher this year, although the easing of US-China tensions has given traders a clear indication President Donald Trump’s administration is taking a softer approach to the clashes. Still, some investors remain wary about the lack of detail in their announcement, and another flare-up could propel bullion back toward the record set last month.

Spot gold was steady at $US3237.86 ($5077.80) an ounce at 7:38 a.m. in Singapore.

The Bloomberg Dollar Spot Index was flat, after rising 1 per cent on Monday. Silver, palladium and platinum were little changed.

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