Gold reversed course and edged higher on Monday, supported by a weaker dollar, after hitting a more than one-month low earlier as easing U.S.-China trade tensions dampened safe-haven demand and bolstered risk appetite.
Spot gold rose 0.3% to $3,281.65 per ounce, as of 0216 GMT, after hitting its lowest since May 29 earlier in the session.
U.S. gold futures were up 0.2% at $3,293.30.
“There is less of a ‘doom and gloom’ outlook surrounding both tariff talks and events in the Middle East, which is relegating gold to play second fiddle to risk assets,” KCM Trade Chief Market Analyst Tim Waterer said.
Asian shares firmed, with Wall Street futures advancing, while U.S. dollar index fell 0.2%. A lower dollar makes greenback-priced bullion less expensive.
The U.S. and China have resolved issues surrounding shipments of rare earth minerals and magnets to the U.S., Treasury Secretary Scott Bessent said on Friday, adding, the Trump administration’s various trade deals with other countries could be done by the September 1 Labor Day holiday.
Meanwhile, U.S. President Donald Trump abruptly cut off trade talks with Canada on Friday over its tax targeting U.S. technology firms, saying that it was a “blatant attack” and he would set a new tariff rate on Canadian goods within a week.
The Iran-Israel ceasefire after a 12-day conflict also appeared to be holding, further reducing safe-haven demand.
“The dollar remains pressured which is limiting the extent of the slide for gold. However, the $3,250 level shapes as a key support level for gold.
Any breach of this level could see losses accelerate towards the $3,200 level,“ Waterer said.
Stable geopolitical and economic conditions often reduce demand for gold as a safe-haven asset, while non-yielding bullion’s appeal further wanes in a high-interest-rate environment.
Spot silver was down 0.1% at $36.02 per ounce, platinum firmed 1% to $1,353.13, while palladium was up 0.2% at $1,135.48.
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