Gold Prices Sluggish Despite Weaker USD, Escalating Trade Tensions
Gold (XAU/USD) prices struggled to capitalize on modest Asian gains on Monday (3/3), although managed to hold comfortably above the three-week low touched on Friday. Bets that the Federal Reserve (Fed) will cut interest rates by a quarter percentage point twice by the end of this year failed to help the US Dollar (USD) build on last week’s recovery from over two-month lows. This, in turn, helped revive demand for the non-yielding yellow metal.
Additionally, concerns about the potential economic impact of US President Donald Trump’s tariff plans and persistent geopolitical risks turned out to be other factors supporting Gold prices as a safe haven. That said, the lack of follow-through buying warrants some caution before confirming that the recent XAU/USD correction from all-time tops is over and placing fresh bullish bets ahead of this week’s important US macro releases.
Source: FXStreet