Gold Slips as Easing Trade Tensions Offset Support from Weak Dollar
Spot gold was down 0.2% at $3,379.69 per ounce, as of 0534 GMT, after dropping 1.3% in the previous session. US gold futures eased 0.4% to $3,385.40.
"Yesterday, gold prices were seen building up for the next bullish run until the news came out on trade front, triggering some profit-taking," said Brian Lan, managing director at GoldSilver Central, Singapore.
"We've seen the dollar has also weakened quite a bit, and of course, this also supports gold. So, I think this is a small retracement at this moment. We are, in fact, still quite bullish on gold."
Signaling progress on the tariff front, US President Donald Trump struck a trade deal with Japan that lowers tariffs on auto imports.
The European Union and the United States are nearing an agreement that would impose 15% tariffs on European imports, while waiving duties on some items, according to officials from the European Commission.
Risk sentiment in the wider financial markets rose on the back of progress in trade talks and hopes that more deals could be in the offering.
Offering support to gold, the US dollar index fell to a more than two-week low, making greenback-priced bullion less expensive for other currency holders.
Investors were also looking forward to a rate decision from the European Central Bank due later in the day.
The US weekly jobless claims numbers due on Thursday and S&P Global's flash PMI data will be in focus to gauge economic health ahead of the Federal Reserve's monetary policy decision next week.
Spot silver slipped 0.6% to $39.04 per ounce, platinum was steady at $1,410.92 and palladium dipped 0.9% to $1,266.41.
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