Gold prices dipped in early Wednesday trading, falling below $3,400 as the European session commenced. This follows the precious metal reaching a multi-week high in the previous session. The announcement that trade talks between the United States and China are expected to occur over the weekend in Switzerland has dampened demand for haven assets such as gold. The prospect of renewed dialogue between the world’s two largest economies—rather than the tit-for-tat tariff exchanges seen so far—has lifted market sentiment and boosted risk appetite among investors. However, the downside for gold remains limited, with ongoing geopolitical tensions and persistent economic uncertainty continuing to support the metal’s underlying appeal. Market attention now shifts to the conclusion of this month’s Federal Reserve meeting. While it is widely anticipated that the Fed will leave interest rates unchanged, investors will closely analyse the accompanying policy statement and subsequent press conference for any indications regarding the central bank’s future rate trajectory. Any such clues could prompt movement in the US dollar and, in turn, impact gold prices, given the inverse correlation between the two assets.
Ricardo Evangelista – Senior Analyst, ActivTrades
Source: ActivTrader
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