Pedro Goncalves writes:
Gold prices climbed on Monday, buoyed by a weaker US dollar, as investors kept a close watch on US trade negotiations and awaited key catalysts, including the Federal Reserve’s upcoming policy meeting.
Gold futures (GC=F) were up 0.6% to $3,377.30 per ounce, at the time of writing, while spot gold rose 0.5% to $3,367.79 per ounce.
The US dollar index (DX-Y.NYB), which measures the greenback against a basket of six currencies, was down 0.2% to 98.29.
“Dollar has made a subdued start to the week, which has left the door open for gold to post gains early doors with tariff deadlines looming large,” KCM Trade chief market analyst Tim Waterer said.
Waterer added that gold’s momentum could continue as the US nears a crucial deadline. “The closer we move towards the key 1 August deadline without any new trade deals emerging, the more likely gold is to start fancying another run towards the $3,400 level and perhaps beyond.”
Investors are following developments in US-China trade talks, with the 1 August deadline set by US president Donald Trump. US commerce secretary Howard Lutnick remains optimistic about reaching a deal with the EU, adding to the uncertain market dynamics.
Reports suggest that Trump may visit China before the Asia-Pacific Economic Cooperation (APEC) summit, scheduled for 30 October 30 to 1 November, or he could meet Chinese president Xi Jinping on the sidelines of the event in South Korea.
Later this week, the European Central Bank (ECB) is expected to keep interest rates steady at 2%, following a series of rate cuts.
Meanwhile, US Federal Reserve governor Christopher Waller indicated last week that he still supports a rate cut at the Fed’s policy meeting scheduled for next week. However, his colleagues remained more cautious due to the risk of persistent inflation triggered by tariffs.
Gold, typically viewed as a safe-haven asset during economic uncertainties, tends to benefit from low-interest-rate environments.