FX.co ★ Gold Drops as US-China Trade Tensions Ease

Gold prices dropped to under $3,290 per ounce on Monday, driven by reduced safe-haven demand due to easing trade tensions between the United States and China. Recently, President Donald Trump suggested a possible softening in his assertive trade approach towards China and noted that tariff negotiations are in progress. Concurrently, China mitigated some of its 125% tariffs on U.S. imports last Friday, although it refuted claims that trade discussions with the U.S. were underway. Further impacting gold, the U.S. dollar strengthened, consequently making dollar-denominated commodities costlier for those with other currencies. Market participants are attentively awaiting several significant economic reports later in the week. These include the initial estimate of U.S. first-quarter GDP, March's Personal Consumption Expenditures inflation data, and April employment figures, all of which could offer additional insights into the Federal Reserve's potential actions and the greater economic outlook.