Gold prices inched lower on Monday, from a five-week high hit earlier in the session, on profit-taking and as fears of a US-China trade war eased following reports of negotiations among two of the world's leading economies. Spot gold was down 0.1 percent at $1,346.01 per ounce, as of 0836 GMT. Earlier in the session, gold prices climbed as much as $1,350.76 per ounce, their highest since February 19.
US gold futures for April delivery slipped 0.3 percent to $1,346.3 per ounce. "A mild early session bid tone to the bullion during Asian trade on Monday, and was soon extinguished by resting offers around $1,350, as participants looked to take profits ahead of key resistance levels," MKS trader Sam Laughlin said in a note.
"Trump and China seem to be narrowing the list of tariffs and it might not be as disastrous as originally thought," said a Singapore-based trader. The United States asked China in a letter last week to cut the tariff on US autos, buy more US-made semiconductors and allow their firms greater access to the Chinese financial sector, the Wall Street Journal reported on Monday, citing unnamed sources.
News of the US-China talks eased fears of a trade war lifting global shares on the back of higher US stock futures.
Gold is sought as a store of value during times of political and financial uncertainty.
"Much of what gold will do this week will be headline-driven, with trade news being front and center," INTL FCStone analyst Edward Meir said in a note.
Meanwhile, speculators cut their net long positions in the week to March 20 by 23,822 contracts to 121,838 contracts, US Commodity Futures Trading Commission (CFTC) data showed on Friday.