Gold Prices Climb on Dollar Dip and Geopolitical Uncertainty

Gold prices climbed slightly in Asian trading on Monday, supported by a weaker dollar and ongoing uncertainty surrounding U.S. trade tariffs and the Russia-Ukraine peace talks, which bolstered gold’s appeal as a safe haven.

Spot Gold rose 0.3% to $2,865.69 per ounce, while Gold Futures for April delivery gained 0.9% to $2,873.59 an ounce by 00:35 ET (05:35 GMT).

Dollar Weakness Boosts Gold

U.S. President Donald Trump's announcement of additional 10% tariffs on China, along with reaffirmed plans for 25% levies on Mexico and Canada, added to market uncertainty. However, U.S. Commerce Secretary Howard Lutnick clarified that Trump would decide the exact tariff levels by Tuesday.

At the same time, a breakdown in talks between Ukrainian President Volodymyr Zelenskyy and U.S. President Trump dampened hopes for a peace agreement in Ukraine, increasing concerns over prolonged geopolitical instability.

As the U.S. Dollar Index dipped 0.4%, gold prices remained supported by safe-haven demand amid ongoing uncertainties.

Other Precious Metals Gain

Other precious metals also saw gains due to the weaker dollar. Platinum Futures rose 1.2% to $949.10 per ounce, and Silver Futures increased 0.7% to $31.730 an ounce.

US Economic Data and Inflation Impact

U.S. consumer sentiment dropped 0.2% in January, marking its first decline in nearly two years. The Atlanta Federal Reserve now projects a slower 1.5% annualized growth for the U.S. economy in Q1 2025, compared to the 2.3% growth in the previous quarter.

This slowdown reinforced expectations for rate cuts, though inflation remains persistent. The PCE price index, the Fed’s preferred inflation gauge, rose 0.3% in January, suggesting that rates may need to stay higher for a longer period.

Copper Price Up on China’s Strong Factory Data

Copper prices saw a modest rise as the dollar weakened, bolstered by strong Chinese manufacturing data. The Caixin PMI for China’s manufacturing sector hit a three-month high, confirming robust factory activity.

Benchmark Copper Futures on the London Metal Exchange edged up 0.3% to $9,985.70 per ton, though April Copper Futures slipped to $4.5595 per pound.

 

 

 

 

 

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