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Gold prices edged lower in Asian trading on Friday, retreating from this week’s record highs as risk appetite improved following signals of potential deescalation in the U.S.-China trade conflict and upbeat earnings from major tech firms. However, the metal remained well-supported near its all-time peak amid lingering geopolitical and economic uncertainty.
As of 01:22 ET (05:22 GMT):
- Spot gold fell 0.9% to $3,318.28 per ounce
- Gold futures (June delivery) dropped 0.6% to $3,328.67 per ounce
Deescalation Hopes Weigh on Safe-Haven Demand
Gold’s dip followed a Bloomberg report suggesting that China may exempt some U.S. goods from its 125% tariffs, in what could be an early signal of easing tensions in the ongoing trade war. This comes amid growing concern within China over the economic cost of prolonged tariff pressure.
U.S. President Donald Trump also stated this week that his administration was “engaged” in discussions with China, although Beijing denied that any formal talks were underway.
Still, markets latched onto the idea of even limited progress, prompting a rotation into risk assets such as equities and reducing the immediate demand for gold as a safe haven.
Trump had previously signaled the potential for reducing the 145% U.S. tariffs on Chinese goods, contingent on China entering negotiations—though U.S. officials warned that any actual deal would take time.
Tech Earnings and AI Buzz Fuel Risk-On Sentiment
Improved sentiment was further reinforced by strong earnings reports from tech heavyweights.
- Alphabet posted better-than-expected quarterly results
- Nvidia and Amazon issued optimistic commentary around AI demand, reinforcing investor confidence in the tech sector
These developments bolstered risk appetite, pressuring gold and pushing global equity markets higher.
Dollar Recovery Caps Metals Rally
A modest rebound in the U.S. dollar, which had recently slipped to a three-year low, also weighed on precious metals. A stronger dollar typically reduces the appeal of dollar-denominated commodities like gold for foreign investors.
Other Metals Also Decline
In line with gold’s pullback:
- Platinum futures dropped 0.9% to $969.10/oz
- Silver futures dipped 0.4% to $33.378/oz
Outlook:
Despite Friday’s decline, gold remains in sight of its all-time high near $3,500/oz hit earlier this week. Ongoing uncertainty over the trajectory of U.S.-China trade relations, persistent geopolitical tensions, and the Fed’s future policy direction continue to offer underlying support for bullion in the near term. Investors will closely monitor any concrete developments in tariff negotiations or policy shifts that could tip the balance between risk and safety.
