Gold prices were relatively stable on Tuesday, remaining close to a three-week low as diminishing fears of a global tariff war and a stronger dollar reduced bullion’s safe-haven appeal.
In Dubai, gold rates declined, with 24-carat gold and 22-carat gold dropping AED2.97 and AED2.57 to AED399.28 and AED369.68, respectively. Additionally, 21-carat gold fell AED4.13 to AED352.87, while 18-carat gold decreased by AED3.29 to AED302.46.
Spot gold maintained its position at $3,311.33 per ounce as of 04:01 GMT, having hit its lowest level since July 9 in the previous session. U.S. gold futures remained steady at $3,310.80.
High-level U.S. and Chinese economic officials convened in Stockholm on Monday for over five hours of discussions aimed at resolving long-standing economic disputes at the core of the trade war between the world’s two largest economies, with an objective to extend a truce by three months.
“A plethora of economic reports will likely influence gold’s trajectory this week, including job reports, inflation data, estimates of second-quarter economic growth, and the FOMC meeting. Although the Fed is expected to hold rates steady, Powell’s remarks will be parsed for signs of a tilt in monetary policy over the upcoming months. Gold is up 0.07 percent for the day at $3,318, with 100-SMA support at $3,260 on the day chart. It has immediate resistance in the $3,343-$3,350 region, marked by the near-confluence 9-SMA, 21-SMA, and 50-SMA,” highlighted Vijay Valecha, chief investment officer, Century Financial, to Economy Middle East.
Trump’s deadline for Russia
On Sunday, the U.S. established a framework trade agreement with the European Union, which imposes a 15 percent import tariff on most EU goods, halving the threatened rate and averting a larger trade war between the two allies that account for nearly a third of global trade.
The dollar index held near its highest level in over a week, making gold more expensive for buyers using other currencies. Meanwhile, U.S. President Donald Trump set a new deadline of “10 or 12 days” for Russia to make progress towards ending the war in Ukraine. Trump warned of severe sanctions if Russia did not act, stating that his administration would impose 100 percent secondary tariffs on countries that continue to buy Russian exports. This situation keeps geopolitical risks in play, bolstering the safe-haven XAU/USD pair.
Awaiting key U.S. macroeconomic data
Investors are awaiting a series of U.S. macroeconomic data this week, including inflation figures and the employment report, along with the Federal Reserve‘s two-day policy meeting commencing later in the day, with expectations largely indicating that rates will be held steady.
If weaker U.S. macro data is reported or if President Donald Trump’s criticisms of the Fed lead the central bank to adopt a more dovish stance this week, it could benefit gold, Waterer noted. Spot silver was down 0.2 percent at $38.09 per ounce, while platinum gained 0.6 percent to $1,397.80, and palladium fell 1.9 percent to $1,223.02.
“Gold prices slipped 0.7 percent in Monday’s session as the greenback strengthened in the wake of the U.S.-EU trade deal and the possibility that China’s tariff deadline could be extended by 90 days. This marks the dollar’s first monthly gain in 2025 and is exerting temporary pressure on gold. Nevertheless, the key catalysts that drove gold up over a quarter this year remain intact. These include safe-haven demand in the event of a flare-up in geopolitical tensions and tariff uncertainty, strong purchases by central banks worldwide, and an uptick in inflows into gold-backed ETFs. However, in the short term, gold has been trading in a tight range between $3,260 and $3,445 over the last few months, after briefly spiking above a record high of $3,500 per ounce on April 22,” further stated Valecha.
