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- Gold price declines to approximately $3,245 in Thursday’s early Asian trading session, reflecting a 1.25% decrease on the day.
- Reduced trade friction and a strengthening US Dollar are exerting downward pressure on the Gold price.
- The US employment report for April, scheduled for release on Friday, will be a key economic indicator to watch.
The price of Gold (XAU/USD) continued its downward trajectory, reaching levels around $3,245 during the early hours of the Asian trading session on Thursday. The precious metal is trading near a two-week low, influenced by a combination of factors including a perceived easing of trade tensions between the United States and China, and increased demand for the US Dollar (USD). Investors are closely monitoring these dynamics as they assess the near-term outlook for gold.
Market risk sentiment is showing signs of improvement following US President Donald Trump’s executive order signed on Tuesday. This order aims to alleviate tariffs on imported auto parts, providing automotive manufacturers with a two-year period to increase their reliance on domestic sourcing. This move is perceived as a step towards de-escalating trade disputes. Furthermore, US Treasury Secretary Scott Bessent conveyed positive sentiment, highlighting the receipt of “very good” proposals from various trade partners, further contributing to the improved market mood.
US trade representative Jamieson Greer indicated late Wednesday that the Trump administration anticipates finalizing preliminary tariff agreements with select US trading partners in the coming weeks. This optimism surrounding the potential resolution of tariff disputes is bolstering the US Dollar and diminishing the appeal of traditional safe-haven assets such as Gold. A stronger dollar makes gold more expensive for investors holding other currencies, thereby reducing demand. Market participants are now factoring in the possibility of reduced global uncertainty, which typically supports riskier assets and diminishes the allure of gold as a hedge against economic downturns. The upcoming US economic data releases, including the April employment report, will be crucial in shaping expectations regarding the Federal Reserve’s monetary policy and further influencing the direction of the gold market.
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