Gold Prices: U.S.-China Trade War De-escalation Impacts Value

Gold prices fell by more than 1% on April 25 following signals of de-escalation in the trade war between the United States and China, as China considers lifting tariffs on certain American goods.

Spot gold dropped by 1.5%, reaching $3,299.69 per ounce, while U.S. gold futures fell by 1.1% to $3,310.20.

“Gold is struggling to maintain its upward momentum as optimism surrounding a potential trade agreement between the U.S. and China grows,” said Zain Vawda, an analyst at MarketPulse by OANDA.

Reuters also noted that the rise of the U.S. dollar contributed to the price drop. Additionally, European stocks rose after media reports that China is considering removing tariffs on some U.S. products.

According to Zain Vawda, a U.S.-China trade deal could drive gold prices down to $3,000 per ounce or lower, depending on the influence of other market factors.

China has already exempted part of U.S. imports from its 125% tariffs and is asking companies to identify critical goods they need tariff-free, according to informed sources. However, China has not yet made any public announcements regarding such exemptions.

The U.S. dollar surged, making gold bullion more expensive for overseas buyers.

“A U.S.-China trade deal could push gold prices down to $3,000 an ounce or lower, depending on other influencing factors,” Vawda reiterated.

Source: Reuters.

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