Slight Decline in Gold Prices Amid Optimism over Easing Trade Tensions
Gold prices witnessed a limited decrease during early trading on Friday, July 25, influenced by a decline in demand for safe havens amid positive signs of progress in trade negotiations between the United States and its partners. Meanwhile, the weakness of the dollar helped ease the losses.
According to available data, the price of gold in spot transactions decreased by 0.1% to reach $1,363.91 per ounce by 02:43 GMT, while still maintaining weekly gains of 0.4%. On the other hand, gold futures in the U.S. market fell by 0.2% to $3,365.50.
In this regard, Calvin Wong, chief market analyst at OANDA, commented: "We are seeing profit-taking by speculators after a wave of optimism in the markets. However, the decline of the dollar and expectations of a reduction in U.S. interest rates continue to support gold around the $3,360 level."
This performance coincided with news of convergence in trade negotiations between the United States and the European Union, as European diplomats reported that the two sides may soon reach an agreement that includes imposing a 15% tariff on European goods, following a similar agreement with Japan by Washington.
In the financial markets, both the S&P 500 and Nasdaq indices reached new record levels at the close of Thursday's session, supported by improved investor sentiment amid signs of easing trade tensions.
On the other hand, the dollar index continues its decline, heading towards recording its worst weekly performance in a month, enhancing the attractiveness of gold as an alternative investment for holders of other currencies.
Recent data showed a surprising drop in U.S. initial jobless claims last week, indicating resilience in the labor market despite slowing employment rates.
The markets are awaiting the Federal Reserve's meeting scheduled for July 29 and 30, where it is expected to keep interest rates unchanged, while expectations lean towards a possible cut in September.
Silver recorded a slight increase of 0.2% to reach $39.14 per ounce, with expectations of weekly gains of 2.5%. On the other hand, platinum fell by 0.2% to $1,407.10, while palladium rose by 0.9% to $1,238.73.
