Gold slipped to a three-week low on Tuesday as hopes for progress in U.S.–China trade talks dampened its safe-haven appeal.
Spot gold fell 0.4% to $3,964.35 per ounce by 1:45 p.m. EDT, marking its lowest level since October 6 this year.
U.S. gold futures dropped 0.9%, settling at $3,983.10 per ounce amid investors’ shifting focus toward the Federal Reserve’s upcoming interest rate decision.
Gold has surged more than 51% this year, driven by geopolitical tensions, trade uncertainties, and expectations of U.S. interest rate cuts.
“The U.S.-China trade tensions have diminished, making safe-haven metals less attractive ahead of a possible deal later this week,” said Kitco analyst Jim Wyckoff.
Economic officials from China and the U.S. finalized a trade framework over the weekend for Presidents Xi and Trump to review on Thursday.
Optimism over easing trade frictions lifted global markets, sending Wall Street’s main indexes to record-high openings on Tuesday morning.
Investors now await the Fed’s two-day policy meeting, where a quarter-point rate cut is widely expected to support economic growth.
Despite near-term declines, gold’s outlook remains mixed, with the London Bullion Market Association projecting $4,980 per ounce over the next 12 months.
Meanwhile, Citi and Capital Economics trimmed their forecasts, while Bank of America warned the market is overbought and approaching $3,800 per ounce.
Silver edged up 0.7% to $47.21 per ounce, recovering slightly from its lowest price since September 26, as platinum and palladium remained largely steady.
The week ahead could prove pivotal for precious metals, balancing trade optimism against long-standing geopolitical and financial uncertainties worldwide.
