Onome Amuge
Gold prices extended their sharp decline for a third consecutive session on Thursday, as the precious metal’s safe-haven allure waned amid growing optimism surrounding potential trade deal negotiations between the United States and its key trading partners.
Spot gold fell by 1.5 per cent to $3,240.30 per ounce, marking its lowest level since April 16th. Meanwhile, gold futures expiring in June slumped by a more pronounced 2.1 per cent to $3,248.64 an ounce.
The yellow metal is on track for its third consecutive day of losses, a notable reversal after scaling record highs last month, fuelled by heightened global economic uncertainty.
According to analysts, a key factor contributing to gold’s downward pressure is the reported outreach from the Trump administration to China to initiate trade talks, as indicated by a Chinese state-affiliated media outlet on Wednesday.
Market sentiment has been cautiously improving on the prospect that the most aggressive tariff announcements may be behind the market. This optimism was further supported by US President Donald Trump’s signing of two orders on Tuesday aimed at easing the impact of potential auto tariffs.
Adding to the positive trade outlook, President Trump also stated on Wednesday that he sees potential trade agreements with India, South Korea, and Japan. These developments have tempered concerns surrounding escalating US-Sino trade tensions, consequently reducing the demand for gold as a traditional safe-haven asset.
Investors eye economic data
Alongside the developments in trade, investors were also assessing recent data indicating an unexpected contraction in the US economy. Market participants are now cautiously awaiting upcoming economic data releases, including the closely watched monthly jobs report, for further clues on the health of the world’s largest economy.
Across other precious metals, silver futures also saw a decline, slipping by 1.3 per cent to $32.115 an ounce, while platinum futures edged lower by 0.7 per cent to $963.65 an ounce.
