Gold prices steadied at weekly lows in Asian trading on Monday, down 4% off recent record highs as investors liquidated positions to raise cash as equity markets tanked.
Spot gold prices fell to US$2,970 in early trade, but found support and lifted $5.35 or 0.2% to $3,043.04 per ounce by 3:30 pm AEST (5:30 am GMT).
The sell-off in gold follows a steep downturn in United States stocks last Friday, triggered by U.S. President Donald Trump's announcement of sweeping reciprocal tariffs on numerous global trading partners.
The stock market rout prompted margin calls, forcing investors to raise liquidity by selling assets, including gold.
Despite the short-term decline, analysts suggest that broader macroeconomic and geopolitical dynamics remain supportive of the precious metal.
"We don’t expect the selloff to be prolonged. It stands to benefit from increasingly volatile trade, macroeconomics and the geopolitical backdrop," ANZ analysts stated in a note to clients. "The tariffs will provide a hit to growth and add to inflation in the short term.
“Financial markets have also brought forward expectations of Fed easing following the announcement.”
