VINACHEM

Gold prices fell in Asian trade on Tuesday, extending recent declines after U.S. President Donald Trump’s postponement of steep trade tariffs on Europe helped buoy risk appetite.

The yellow metal was also pressured by some signs of stability in the bond market, as major government bond yields retreated in Asian trade after a sharp run-up in recent sessions.

Still, gold’s overall losses were limited by persistent weakness in the dollar. But broader metal prices also lost ground after strong gains through the past week.

Spot gold fell 0.5% to $3,326.53 an ounce, while gold futures for August fell 1.2% to $3,353.09/oz by 01:30 ET (05:30 GMT).

Gold dips as Trump tariff turnaround spurs risk

Gold was pressured chiefly by some improving risk appetite after Trump delayed plans to immediately impose 50% tariffs on the European Union.

Trump said the tariffs will kick-in by early-July, when the rest of his planned reciprocal tariffs are also set to take effect.

The move offered some relief to markets fearing a worsening in global trade conditions, and sparked buying into risk-driven assets. U.S. stock index futures rose sharply on Tuesday, although volumes were dulled by a U.S. holiday on Monday.

But despite this week’s losses, gold still remained relatively underpinned by concerns over the long-term impact of Trump’s tariffs.

Minneapolis Federal Reserve President Neel Kashkari warned on Monday that the tariffs were likely to spur a stagflationary shock for the U.S. economy, ie– an era of sluggish growth and high inflation.

But he also said that the Fed was unlikely to cut rates in the near-term, helping spur some buying in battered U.S. Treasuries.

Metal prices sink as Treasuries, bond yields stabilize 

Broader metal prices fell on Tuesday, amid some buying into government bonds after a sharp selldown in the sector over the past week.

A Moody’s downgrade to the U.S. sovereign rating, coupled with the progress of a divisive tax cut bill in Congress, sparked heightened concerns over high government debt levels.

These concerns sparked an extended selldown in Treasuries, sending yields up sharply. But yields were seen coming down from recent peaks on Tuesday, while the dollar steadied, pressuring metal prices.

Platinum futures fell 1.1% to $1,079.50/oz, while silver futures fell 1.2% to $33.265/oz. Both metals were also subject to some profit-taking after clocking strong gains in the past week.

Among industrial metals, benchmark copper futures on the London Metal Exchange fell 0.6% to $9,562.80 a ton, while U.S. copper futures fell 1.6% to $4.7730 a pound.  – Source: investing.com