Photo by Michael Steinberg
Gold prices tumbled to their lowest levels in two weeks on Thursday, dragged down by easing global trade tensions, thin liquidity due to a holiday in China—the world’s top gold consumer—and investor anticipation of Friday’s U.S. jobs report.
Spot gold slid 2.2% to $3,216.41 an ounce by 10:25 a.m. ET (1425 GMT), after earlier touching its weakest point since April 14. The yellow metal had soared to a record high of $3,500.05 per ounce just last week.
Meanwhile, U.S. gold futures fell 2.8%, settling at $3,226.90 per ounce.
“Markets are leaning toward risk-on sentiment with emerging signs of potential trade deals. There’s chatter that the Trump administration reached out to China, and that’s triggering profit-taking in gold,” said Bob Haberkorn, senior market strategist at RJO Futures. U.S. President Donald Trump said that trade deals may soon be inked with India, Japan, and South Korea. He also expressed optimism about reaching an agreement with China. Supporting this, a social media post linked to Chinese state media suggested that the U.S. had sought dialogue with Beijing regarding Trump’s steep 145% tariffs.
Trading volumes were also lighter as Chinese markets remain shut for the May 1–5 Labour Day holiday.
According to TD Securities, “Gold is currently caught in a liquidity vacuum created by China’s market closure.”
On the economic front, data released Wednesday showed the U.S. economy contracted in the first quarter, while the personal consumption expenditures (PCE) price index—a key inflation gauge—remained unchanged in March. Investors are now turning their attention to the upcoming U.S. nonfarm payrolls report, set to be released Friday, for more clarity on economic momentum.
Federal Reserve officials have reiterated that they will keep interest rates steady until inflation convincingly trends toward the 2% target or until labor market weakness emerges.
Typically, lower interest rates and heightened geopolitical risks make non-yielding assets like gold more attractive to investors.
“Although the recent dip is tied to improved investor sentiment, the long-term fundamentals driving gold’s strength are still firmly in place,” noted Ole Hansen, head of commodity strategy at Saxo Bank.
Other precious metals also saw mixed movements. Spot silver dropped 1.3% to $32.15 per ounce, while platinum shed 1.2%, falling to $954.85. Palladium, however, edged up 0.4%, reaching $941.14.
