NEW YORK: Gold prices fell 2% on Friday and were en route for a weekly dip as the dollar rose and signs of easing US-China trade tensions after a report that Beijing has exempted some US goods from its tariffs weighed on bullion.
Spot gold was down 1.9% at $3,284.13 an ounce as of 09:10 a.m. EDT (1310 GMT). Bullion is down 1.2% for the week. US gold futures slipped 1.6% to $3,294.50.
“The apparent detente on tariffs is negatively affecting gold prices … But so far we’ve not seen substantial liquidations,” said TD Securities commodity strategist Daniel Ghali.
“However, we know that they’ve continued to buy the dip over the last few sessions, so we think gold can resume its upward trajectory.” China is considering exempting some US imports from its 125% tariffs and is asking businesses to identify goods that could be eligible, according to businesses notified.
Earlier this week, US President Donald Trump suggested a de-escalation of their tit-for-tat tariff battle, saying direct talks were already underway.
The US dollar, meanwhile, rose and was on track for its first weekly gain since March, making bullion more expensive for overseas buyers. Gold, traditionally seen as a hedge against geopolitical and economic uncertainties, scaled a record high of $3,500.05 per ounce and has gained more than 25% so far this year, owing to US-China trade tensions and strong central bank demand.
“Trade war concerns were the main reason behind all the prior gold buying. But it could still be a while before we see actual progress and so those concerns are not completely gone just yet,” said Fawad Razaqzada, market analyst at City Index and FOREX.com.
Elsewhere, spot silver slipped 1.1% to $33.21 an ounce, but was heading for its third straight weekly gains. Platinum fell 0.5% to $965.75 and palladium dipped 1.5% to $939.82.
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