Gold Held Back As Markets Spooked By Trump’s Additional Tariff Strategy On China
Gold (XAU/USD) prices hit an all-time high on Monday at $2,956, although sentiment quickly turned. The precious metal was trading around $2,940 at the time of writing on Tuesday, after the US President Donald Trump administration communicated its plans to impose more restrictions on China’s technological development. A tougher stance on semiconductor restrictions and pressuring other allies to corner China are part of the strategy.
The news set a negative tone in the market on Tuesday. Traders turned to bonds as a safe haven, which pressured yields to fall further (the inverse correlation of bond prices to yields). Equities are also being slaughtered, with red figures across the board from Asia to Europe, including US equity futures. Except for three Federal Reserve (Fed) members who are due to speak, there is not much expected on Tuesday ahead of the Personal Consumption Expenditures (PCE) due on Friday.
Source: FXStreet