Gold rises as dollar eases ahead of US-China trade talks
Gold rose over 1% on Friday as the dollar ticked lower, while the market digested recent tariff remarks from U.S. President Donald Trump ahead of a weekend meeting between the U.S. and China.
Spot gold was up 0.8% to $3,332.88 an ounce at 0919 ET(13:18 GMT) and gained nearly 3% so far this week.
Bullion, known as a hedge against geopolitical and economic uncertainties has risen more than 27% since the start of the year.
U.S. gold futures were up 1% to $3,338.10.
The U.S. dollar edged 0.3% lower, making bullion less expensive for other currency holders.
U.S. President Donald Trump said that 80% tariffs on Chinese goods "seems right" as representatives prepared for weekend talks to contain a trade war between the world's two largest economies.
Additionally, on the geopolitical front, India and Pakistan accused each other of launching new military attacks, using drones and artillery for the third day in the worst fighting between the nuclear-armed South Asian neighbours in nearly three decades.
"Obviously, the overall continued uncertainty in regards to tariffs remains probably the most significant underpinning behind gold," said David Meger, director of metals trading at High Ridge Futures.
"We're not quite as favourable towards gold as we have been over the course of the past several months. We could be moving into a period of more consolidation or retracement for a period of time."
On the physical front, Indian gold dealers offered price discounts this week amid weak demand as a weaker rupee lifted local prices to near-record highs, while buying in China picked up after a holiday.
Elsewhere, Trump's trade policies will likely lift inflation, lower growth, and raise unemployment later this year, Federal Reserve Governor Michael Barr said, leaving policymakers with a potentially tricky decision on which problem to fight.
Spot silver added 0.2% to $32.56 an ounce, platinum rose 1.1% to $986.55 and palladium climbed 0.1% to $976.68.
(Reporting by Ashitha Shivaprasad and Sarah Qureshi in Bengaluru; editing by David Evans)
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Khaleej Times
an hour ago
- Khaleej Times
Trump doubles global steel and aluminum tariffs to 50%, accuses China of violating trade deal
US President Donald Trump on Friday accused China of violating a bilateral deal to roll back tariffs and announced a doubling of worldwide steel and aluminum tariffs to 50 per cent, once again rattling international trade. Trump said China had violated an agreement with the US to mutually roll back tariffs and trade restrictions for critical minerals and issued a new veiled threat to get tougher with Beijing. "China, perhaps not surprisingly to some, has totally violated its agreement with US. So much for being Mr. Nice Guy!," Trump said in a post on his Truth Social platform. Later, at a rally in Pennsylvania promoting an impending "partnership" between Japan's Nippon Steel and US Steel, he announced the US would double steel tariffs from 25 per cent to 50 per cent, effective next week, which he said "will even further secure the steel industry in the United States." He subsequently announced in a Truth Social post that aluminum tariffs would also double to 50% on Wednesday. While China is the world's largest steel producer and exporter, very little is sent to the United States, as a 25% tariff imposed in 2018 shut most Chinese steel out of the market. China ranks third among aluminum suppliers. On overall trade with China, Trump said he made a "fast deal" in mid-May with Chinese officials for both countries to back away from triple-digit tariffs for 90 days. He said he did this to save China from a "devastating" situation, factory closings and civil unrest caused by his tariffs of up to 145 per cent on Chinese imports. Trump did not specify how China had violated the agreement made in Geneva, Switzerland, or what action he would take against Beijing. Asked later on Friday in the Oval Office about the China deal, Trump said: "I'm sure that I'll speak to President Xi, and hopefully we'll work that out." Rare earths licences But a US official told Reuters that it appeared China was moving slowly on promises to issue export licenses for rare earths minerals. The deal called for China to lift trade countermeasures that restrict its exports of the critical metals needed for US semiconductor, electronics and defense production. "The Chinese are slow-rolling their compliance, which is completely unacceptable and it has to be addressed," US Trade Representative Jamieson Greer told CNBC, without specifying how that would happen. Indeed, Reuters reported on Friday that global auto executives are sounding the alarm on an impending shortage of rare-earths magnets from China – used in everything from windshield-wiper motors to anti-lock braking sensors – that could force the closure of car factories within weeks. Liu Pengyu, a spokesperson for China's embassy in Washington, said China has maintained communications on trade matters with US counterparts since the Geneva talks, but raised concerns about US export controls. "China once again urges the US to immediately correct its erroneous actions, cease discriminatory restrictions against China and jointly uphold the consensus reached at the high-level talks in Geneva," Liu said in a statement. Reuters reported earlier this week that the US has ordered a broad swath of companies to stop shipping goods to China without a licence and revoked some existing export licences, according to three people familiar with the matter. Products affected include design software and chemicals for semiconductors, butane and ethane, machine tools and aviation equipment, these sources said. Spokespersons for the White House, the US Treasury and the US Trade Representative's Office did not respond to requests for comment. China talks 'stalled' On Thursday, Treasury Secretary Scott Bessent told Fox News Channel that US trade talks with China were "a bit stalled" and that getting a deal over the finish line will likely need the direct involvement of Trump and Xi. The US-China agreement two weeks ago to dial back triple-digit tariffs for 90 days prompted a massive relief rally in global stocks, and along with other pauses on Trump's import taxes, lowered the effective US tariff rate to the mid-teens from around 25 per cent in early April. It was less than 3 per cent when Trump took office in January. The temporary truce between Washington and Beijing, however, had done nothing to address the underlying reasons for Trump's tariffs on Chinese goods, mainly longstanding US complaints about China's state-dominated, export-driven economic model, leaving those issues for future talks. Major US stock indexes ended little changed on Friday after Trump's complaint about China's compliance. Trump's social media post came two days after a reporter infuriated him by asking him about Wall Street's new term for bets that he will back off extreme tariff actions - the "TACO" trade, an acronym coined by a Financial Times columnist for "Trump Always Chickens Out." "I chicken out? Oh, I've never heard that. You mean because I reduced China from 145 per cent that I set, down to 100 and then to another number?" Trump said, later adding: "It's called negotiation." Trump's tariff strategy also suffered a major setback on Wednesday when the US Court of International Trade ruled that his broad global tariffs, including those on China, were invalid because he exceeded his authority under an emergency powers law used to back them. An appeals court has issued a temporary stay for the decision, allowing them to remain in place for tariffstrump tariffs
Dubai Eye
4 hours ago
- Dubai Eye
US proposes 60-day ceasefire for Gaza; hostage-prisoner swap, plan shows
A US plan for Gaza on Friday proposes a 60-day ceasefire and the release of 28 Israeli hostages in the first week, in exchange for the release of 1,236 Palestinian prisoners and the remains of 180 Palestinians. The document, which says the plan is guaranteed by US President Donald Trump and mediators Egypt and Qatar, includes sending humanitarian aid to Gaza as soon as Hamas signs off on the ceasefire agreement. The aid will be delivered by the United Nations, the Red Crescent and other agreed channels. On Thursday, the White House said Israel had agreed to the US ceasefire proposal. Israeli media said Prime Minister Benjamin Netanyahu told the families of hostages held in Gaza that Israel had accepted the deal presented by Trump's Middle East envoy Steve Witkoff. Hamas told Reuters it was reviewing the plan and would respond on Friday or Saturday. The US plan provides for Hamas to release the last 30 of the 58 remaining Israeli hostages once a permanent ceasefire is in place. Israel will also cease all military operations in Gaza as soon as the truce takes effect, it shows. The Israeli army will also redeploy its troops in stages. Deep differences between Hamas and Israel have stymied previous attempts to restore a ceasefire that broke down in March. Israel has insisted that Hamas disarm completely, be dismantled as a military and governing force and return all 58 hostages still held in Gaza before it will agree to end the war. Hamas has rejected the demand to give up its weapons and says Israel must pull its troops out of Gaza and commit to ending the war. Israel launched its campaign in Gaza in response to the Hamas attack in its south on October 7, 2023, that killed some 1,200 people and saw 251 Israelis taken hostage into Gaza, according to Israeli tallies. The subsequent Israeli military campaign has killed more than 54,000 Palestinians, Gaza health officials say, and left the enclave in ruins. MOUNTING PRESSURE Israel has come under increasing international pressure, with many European countries openly demanding an end to the war and a major relief effort. Witkoff told reporters on Wednesday that Washington was close to "sending out a new term sheet" about a ceasefire by the two sides in the conflict. "I have some very good feelings about getting to a long-term resolution, temporary ceasefire and a long-term resolution, a peaceful resolution, of that conflict," Witkoff said at the time. The 60-day ceasefire, according to the plan, may be extended if negotiations for a permanent ceasefire are not concluded within the set period. Senior Hamas official Sami Abu Zuhri said on Thursday the terms of the proposal echoed Israel's position and did not contain commitments to end the war, withdraw Israeli troops or admit aid as Hamas has demanded. The Gaza Humanitarian Foundation, a private group backed by the US and endorsed by Israel, expanded its aid distribution to a third site in Gaza on Thursday. Heavily criticised by the UN and other aid groups as inadequate and flawed, the group began its operation this week in Gaza, where the UN has said 2 million people are at risk of famine after Israel's 11-week blockade on aid entering the enclave. The launch was marred by tumultuous scenes on Tuesday as thousands of Palestinians rushed to distribution points and forced private security contractors to retreat. The chaotic start to the operation has raised international pressure on Israel to get more food in and halt the fighting in Gaza. GHF has so far supplied about 1.8 million meals and plans to open more sites in coming weeks.
Dubai Eye
4 hours ago
- Dubai Eye
Trump's tariffs to remain in effect after appeals court grants stay
A federal appeals court temporarily reinstated the most sweeping of President Donald Trump's tariffs on Thursday, a day after a US trade court ruled that he had exceeded his authority in imposing the duties and ordered an immediate block on them. The United States Court of Appeals for the Federal Circuit in Washington said it was pausing the lower court's ruling to consider the government's appeal, and ordered the plaintiffs in the cases to respond by June 5 and the administration by June 9. Wednesday's surprise ruling by the US Court of International Trade had threatened to kill or at least delay the imposition of Trump's so-called Liberation Day tariffs on imports from most US trading partners and additional tariffs on goods from Canada, Mexico and China. The latter was related to his accusation that the three countries were facilitating the flow of fentanyl into the US. The trade court's three-judge panel ruled that the Constitution gave Congress, not the president, the power to levy taxes and tariffs, and that the president had exceeded his authority by invoking the International Emergency Economic Powers Act, a law intended to address threats during national emergencies. Senior Trump administration officials had said they were undeterred by the trade court's ruling, saying they expected either to prevail on appeal or employ other presidential powers to ensure the tariffs go into effect. Trump has used the threat of charging US importers costly tariffs for goods from almost every other country in the world as leverage in international trade talks, a strategy the trade court's ruling would upend. The trade court ruling had not interfered with any negotiations with top trading partners that are scheduled in the days ahead, Trump's administration said. Trump himself wrote in a statement shared on social media that he hoped the US Supreme Court would "reverse this horrible, Country threatening decision" of the trade court, while lambasting the judicial branch of government as anti-American. Many US trading partners offered careful responses. The British government said the trade court's ruling was a domestic matter for the US administration and noted it was "only the first stage of legal proceedings". Both Germany and the European Commission, the European Union's executive arm, said they could not comment on the decision. Canadian Prime Minister Mark Carney said the trade court's finding was "consistent with Canada's longstanding position" that Trump's tariffs were unlawful. Financial markets, which have whipsawed in response to the twists and turns in Trump's chaotic trade war, reacted with cautious optimism to the trade court ruling, though gains in stocks on Thursday were largely limited by expectations that the court's ruling faced a potentially lengthy appeals process. Indeed, analysts said broad uncertainty remained regarding the future of Trump's tariffs, which have cost companies more than $34 billion in lost sales and higher costs, according to a Reuters analysis. Some sector-specific tariffs, such as on imports of steel, aluminum and automobiles, were imposed by Trump under separate authorities on national security grounds and were unaffected by the ruling. The Liberty Justice Center, the nonprofit group representing five small businesses that sued over the tariffs, said the appeals court's temporary stay was a procedural step. Jeffrey Schwab, senior counsel for the center, said the appeals court would ultimately agree with the small businesses that faced irreparable harm of "the loss of critical suppliers and customers, forced and costly changes to established supply chains, and, most seriously, a direct threat to the very survival of these businesses". A separate federal court earlier on Thursday also found that Trump overstepped his authority in using the International Emergency Economic Powers Act for what he called reciprocal tariffs of at least 10 per cent on goods from most US trading partners and for the separate 25 per cent levies on goods from Canada, Mexico and China related to fentanyl. That ruling was much narrower, however, and the relief order stopping the tariffs applied only to the toy company that brought the case. The administration has appealed that ruling as well.
