Gold corrects from new all-time highs as US makes progress in trade talks
Gold price (XAU/USD) corrects to near $3,290 in Thursday’s North American session after hitting a fresh all-time high of $3,358 earlier in the day. The precious metal faces some profit-booking as meaningful progress in trade negotiations by the United States (US) with Japan and Mexico has offered some relief on fears of potential global economic turmoil. However, US-China trade tensions would continue to protect the downside in the Gold price.
"Had a very productive call with the President of Mexico yesterday. Likewise, I met with the highest-level Japanese Trade Representatives. It was a very productive meeting. Every Nation, including China, wants to meet! Today, Italy! US President Donald Trump wrote in a post on Truth.Social platform in late European trading hours on Thursday.
Positive development in trade talks by Washington with its trading partners indicates that US President Trump has used the tariff tool to have a dominant position while negotiating bilateral deals with his trading partners. This has resulted in a slight ease in global market uncertainty.
Meanwhile, the intensified trade war between the US and China is sufficient to keep the risk-appetite theme at bay. Precious metals tend to perform better in heightened global economic tensions.
The tussle between the US and China has become more of a battle of dignity than a scale of tariffs. The US wants China to initiate trade talks first, citing that they need our money. Meanwhile, China is willing to come to the table, but with respect and mutual interest. On Tuesday, White House press secretary Karoline Leavitt said that the President wants China to go first for trade talks. "The ball is in China’s court: China needs to make a deal with us, we don’t have to make a deal with them,” Leavitt said.
Source: FXstreet
