Gold Prices Decline Due to Customs Deadline Extension and Trump's Optimism on Trade Agreements

Gold prices witnessed a significant decrease during Monday's trading, July 7, influenced by statements made by U.S. President Donald Trump praising the progress in trade negotiations with several countries, along with his decision to postpone the imposition of new tariffs.

Gold in the spot market dropped by 0.8% to settle at $3305.22 per ounce, while U.S. gold futures fell by 0.7% to $3317.40 per ounce.

This decline came after Trump confirmed yesterday that the U.S. is nearing the completion of several trade agreements, indicating that the concerned countries will receive notifications of revised customs tariffs by July 9, to be implemented on August 1.

It is worth noting that the U.S. administration had announced in April the imposition of a 10% customs duty on most imports, with the possibility of gradually increasing it to 50%. However, it later decided to postpone the implementation of the majority of these tariffs except for the 10%, granting an extension until July 9.

In this regard, Kelvin Wong, senior market analyst at OANDA, commented on the situation to Reuters, saying: "This short-term U.S. deferral is what is currently weighing on gold prices."

Moreover, concerns about the inflationary effects of tariff increases have reduced expectations for the pace of interest rate cuts by the Federal Reserve. The markets no longer anticipate an imminent interest rate cut this month, while current forecasts suggest the possibility of only two cuts of a quarter percentage point each by the end of the year.