Mumbai: Gold prices remained largely subdued in international markets on Thursday, as renewed optimism surrounding global trade negotiations particularly between the United States and China tempered demand for the precious metal as a safe-haven asset. However, the decline in gold prices was limited by the continued weakness of the U.S. dollar, which offered some support to bullion investors.
Spot gold hovered near $2,360 per ounce, reflecting a cautious market that is balancing between easing trade tensions and ongoing macroeconomic uncertainty. U.S. gold futures saw only a slight dip, indicating that while investor appetite for risk has improved, gold remains a key hedge in diversified portfolios.
Recent positive developments in trade talks between Washington and Beijing have calmed global market nerves, reducing the immediate need for defensive assets like gold. Reports suggest that both sides are moving toward a framework that could ease tariffs and promote bilateral economic cooperation a sharp contrast from the hostile standoff seen in previous years.
As geopolitical tensions de-escalate and economic outlooks brighten, traditional safe-haven assets such as gold typically see reduced demand. This trend has been evident in recent trading sessions, with gold losing some upward momentum.
Despite the bearish pressure from trade optimism, gold has not experienced a steep sell-off thanks largely to the persistent weakness in the U.S. dollar. The dollar index, which measures the greenback’s strength against a basket of major currencies, has been on a downward trajectory due to expectations that the U.S. Federal Reserve may soon shift to a more dovish monetary stance.
A weaker dollar generally supports gold prices by making the metal cheaper for holders of other currencies, thereby increasing global demand. In this case, the soft dollar has acted as a cushion, preventing gold from registering deeper losses.
Market analysts suggest that gold may continue to trade within a narrow range in the near term as investors await more concrete signals regarding interest rates, inflation trends, and economic growth. The U.S. Federal Reserve's upcoming meetings will be closely watched for any hints of policy changes. Any indication of rate cuts or slowing economic growth could renew interest in gold.
“Gold is currently in a balancing act,” said one commodities strategist. “The easing of trade tensions is dragging it down, but the softer dollar and potential for accommodative monetary policy are keeping it afloat.”
Despite recent fluctuations, gold continues to serve as a critical hedge against inflation, currency volatility, and long-term geopolitical instability. Institutional investors, central banks, and retail buyers alike are maintaining a measured approach, keeping gold in their portfolios while watching global developments unfold.
In summary, gold prices have found themselves at a crossroads caught between optimism over global trade recovery and broader economic uncertainties. While the bullish momentum has slowed, gold remains firmly in focus for investors seeking to protect their wealth in an unpredictable world.