Gold Heads for Worst Week Since November as Trade Truce Dulls Safe-Haven Appeal

Gold prices declined in Asian trading on Friday, poised for their steepest weekly drop in over six months, as signs of easing trade tensions between the United States and China dampened investor appetite for safe-haven assets.

Spot gold fell 0.8% to $3,214.90 an ounce, while gold futures for June delivery slipped 0.3% to $3,217.65 by 01:27 ET (05:27 GMT). The yellow metal has now lost about 3.2% this week, marking its worst performance since early November 2024.

Trade Deescalation Undermines Haven Demand

The recent slide in gold comes as Washington and Beijing agreed to temporarily cut their respective tariffs, in what is seen as a meaningful step toward resolving their prolonged trade dispute. The deescalation has boosted risk appetite across global markets, prompting a rotation out of defensive assets like gold.

The agreement has also revived hopes for additional U.S. trade deals with other major economies, driving a broad rally in equities and commodities earlier in the week. While this risk-on sentiment has moderated slightly heading into Friday, gold prices remained under pressure.

Dollar Strength and Rising Yields Add Headwinds

Gold was also pressured by a firmer U.S. dollar and rising Treasury yields, which reduce the appeal of non-yielding assets such as bullion. Profit-taking was another key theme this week, with traders cashing in after gold recently hit record highs above $3,500/oz earlier this month.

Despite the selloff, spot gold remains comfortably above the $3,000 level, signaling some underlying support from macro uncertainty and cautious optimism that any U.S.-China détente may be short-lived.

Other Precious Metals Also Slide

Other precious metals tracked gold lower on Friday:

• Platinum futures fell 0.5% to $989.90/oz, extending weekly losses.
• Silver futures dropped 0.3% to $32.593/oz, also heading for a weaker weekly close.

Copper Drifts Lower, Eyes on China Data

In the industrial metals space, copper prices edged lower but held onto weekly gains on optimism over China’s economic outlook.

• London Metal Exchange copper fell 0.2% to $9,567.30 a ton.
• U.S. copper futures dropped 0.2% to $4.6695 a pound.

Investors are now awaiting a fresh round of Chinese economic data next week, starting with industrial production and retail sales on Monday. Markets are also focused on the People’s Bank of China’s decision on the loan prime rate on Tuesday, with expectations for potential easing to support the world’s second-largest economy.

While gold may continue to face headwinds from improved sentiment and firmer yields, lingering uncertainty around the global growth outlook and the durability of the trade truce could keep it underpinned in the near term.