Gold slips to 2-week low on trade talk hopes, China holiday
Gold dropped to a two-week low on Thursday, pressured by signals of softening trade tensions and a holiday in top consumer China, while focus was also on Friday's U.S. payrolls report to gauge the economic outlook.
Spot gold was down 2.3% at $3,211.53 an ounce at 1:44 p.m. ET (1744 GMT), after hitting its lowest since April 14 earlier in the session. Prices hit a record $3,500.05/oz last week.
U.S. gold futures settled 2.9% lower at $3,222.20.
"There's hints of upcoming trade deals, and talk from China that the Trump administration had reached out. A risk-on trade is going on, leading to some profit-taking in gold's safe-haven," said Bob Haberkorn, senior market strategist at RJO Futures.
U.S. President Donald Trump said trade agreements could be reached with India, Japan, and South Korea. There is a "very good chance" of securing a deal with China, he added.
Additionally, a social media account affiliated with Chinese state media said the U.S. has approached China to seek talks over Trump's 145% tariffs.
Chinese markets were closed for the Labour Day holiday on May 1-5.
Data on Wednesday showed that the U.S. economy contracted in the first quarter, and the U.S. personal consumption expenditures price index was unchanged in March. Now, all eyes are on the U.S. nonfarm payrolls report due on Friday.
Federal Reserve policymakers indicated interest rates would remain unchanged until there were clear signs of lowering inflation to the 2% goal or potential job market deterioration.
"While the short-term correction has been driven by improved market sentiment, the structural drivers underpinning gold's strength remain firmly in place," Ole Hansen, head of commodity strategy at Saxo Bank, wrote.
Spot silver fell 1.4% to $32.13, platinum lost 0.6% to $961.05, and palladium gained 0.4% to $941.33.
Source: Reuters
