Washington: Gold prices saw a modest increase on Thursday as the U.S. dollar slipped from its recent highs and investors awaited the outcome of the upcoming meeting between U.S. President Donald Trump and Chinese President Xi Jinping.
Spot gold rose by 0.2 percent to around 3,937 dollars an ounce, while U.S. gold futures for December delivery were down 1.2 percent at about 3,950 dollars. The U.S. dollar index eased by 0.2 percent after reaching a two-week high, making the precious metal more attractive to investors using other currencies.
Market analysts noted that the current rise in gold prices is largely due to a technical rebound rather than strong fundamental factors. The Federal Reserve’s latest interest rate cut of 0.25 percentage points brought rates down to a range of 3.75 to 4 percent. However, the Fed signaled caution about future cuts, which limited gold’s upward potential.
The focus now shifts to the high-profile meeting between President Trump and President Xi in South Korea. Investors are hoping for signs of progress in trade relations between the two largest economies. Any improvement in trade ties could reduce the demand for safe-haven assets like gold.
Earlier this week, gold had fallen to near a three-week low of around 3,974 dollars as optimism grew over a possible trade deal between Washington and Beijing. A softer U.S. dollar and expectations of slower rate cuts continue to influence investor sentiment.
Analysts believe gold’s next direction will depend on several key factors, including the outcome of the Trump-Xi talks, future Federal Reserve policy signals, and fluctuations in the dollar index. While the weaker dollar offers some support, improving trade relations and reduced rate-cut expectations may limit further gains in gold prices.
In India and other major gold-importing nations, the combination of a weaker dollar and stable demand could keep domestic prices steady in the short term. However, traders remain cautious as global economic signals and policy moves continue to shape the outlook for the precious metal.