Gold prices traded slightly lower on Tuesday, pulling back from fresh three-week highs as the United States dollar regained some strength and investors turned their focus to upcoming U.S. economic data.
By 3:50 pm AEST (5:50 am GMT) spot gold was down $16.82 or 0.5% at US$3,365.36 per ounce, after touching a monthly high of $3,392.31.
The U.S. dollar rebounded modestly after Monday’s decline, with investors reacting to renewed trade tensions and gearing up for the release of the JOLTS job openings data later in the session.
Despite the pullback, gold remains supported by mounting concerns over trade and geopolitics, which have sparked a fresh wave of safe-haven demand.
The market remains alert to tensions stemming from U.S. President Donald Trump’s recent trade policies. Trump announced on Friday a decision to double tariffs on steel and aluminium imports to 50%.
Further rattling markets, Trump accused China of failing to uphold its agreement with the U.S. to roll back tariffs and of withholding key products essential to the industrial supply chain.
“Gold surged higher on renewed demand for haven assets. Russia and Ukraine wrapped up a second round of talks in Istanbul that failed to bring the two sides closer to ending the war. Meanwhile, renewed trade tensions between the U.S. and China boosted demand for bullion," ANZ analysts wrote in a note to clients.
However, the dollar’s rebound on Tuesday, possibly driven by short-covering ahead of key labour market indicators, capped further gold gains.
A strong reading from the JOLTS job openings survey and other upcoming employment data could reinforce expectations that the Federal Reserve will maintain a cautious stance, potentially supporting the Greenback and limiting gold’s upside in the near term.
