Gold Slips as Trump Calms Markets and Trade Optimism Rises

Gold prices declined in early Wednesday trading as market tensions eased following a shift in tone from the U.S. administration. President Donald Trump backed away from threats to dismiss the Federal Reserve Chair and expressed optimism about reaching a trade agreement with China—reducing gold’s appeal as a safe-haven asset.

Market Update

As of 02:56 GMT, spot gold fell by 0.7% to $3,357.11 per ounce. U.S. gold futures also dropped 1.5% to $3,366.80. The dip follows a strong performance on Tuesday when gold reached a new record high of $3,500 per ounce, marking its 28th peak of the year.

Key Drivers

The shift in political rhetoric led to renewed investor confidence in equity markets and the U.S. dollar. As the dollar strengthened, gold became more expensive for holders of other currencies, contributing to reduced demand. The softer stance from Washington eased fears of monetary instability and encouraged a shift away from safe assets.

Tariff Outlook and Market Expectations

Recent remarks hinted at a possible trade agreement between the U.S. and China that may include substantial tariff reductions. Although no deal is imminent, this outlook has lowered short-term demand for gold. Still, long-term expectations remain bullish, with ongoing uncertainty in global monetary policy likely to support gold prices in the future.

Performance of Other Precious Metals

Silver rose 0.5% to $32.67 per ounce. Platinum edged down 0.2% to $956.53, while palladium slipped 0.2% to $933.72.