Gold slips as China considers suspending some tariffs

Bengaluru — Gold prices declined on Friday as China mulls suspending tariffs on certain US imports, denting the metal’s safe-haven appeal.

Spot gold fell 0.8% to $3,322.36/oz by 4.21am GMT. US gold futures shed 0.5% to $3,332.90.

“The partial rollback of tariffs on some imports from China may be perceived as a positive step towards further de-escalation in US-China trade tensions, which exert modest downward pressure on safe-haven assets like gold,” said IG market strategist Yeap Jun Rong.

China may exempt some US imports from its 125% tariffs and is asking businesses to identify goods that could be eligible in the biggest sign yet that Beijing is anxious about the trade war’s economic fallout.

Meanwhile, US President Donald Trump asserted that trade talks with China were under way, pushing back against Chinese claims that no discussions had taken place to ease the trade war.

A spokesperson for China’s commerce ministry said that if the US “truly” wanted to resolve the dispute, it should lift all unilateral tariff measures against China.

Non-yielding bullion, often viewed as a safeguard against global instability and which thrives in low interest rate environments, has surged more than $700 this year, scaling multiple record peaks. It reached $3,500.05 on Tuesday.

“Over the longer term, structural tailwind remains intact, with further room for reserve diversification among emerging markets as they gradually align with the reserve composition of advanced economies,” Rong said.

Fed officials indicated they saw no urgency in revising the monetary policy as they sought more information to determine how the Trump administration’s tariffs were affecting the economy.

On the geopolitical front, Trump rebuked Russian President Vladimir Putin after a Russian missile and drone attack on Ukraine’s capital Kyiv, the biggest this year, resulted in at least 12 deaths.

Spot silver fell 0.3% to $33.46/oz, platinum dropped 0.5% at $966.34 and palladium fell 1.2% to $942.20. 

Reuters