Gold prices eased on Monday as the dollar strengthened, with investors awaiting new drivers after last week’s rally, which saw gold hit three consecutive record highs. The rise was fueled by geopolitical tensions, economic concerns, and expectations of U.S. interest rate cuts.
As of 0302 GMT, spot gold dropped 0.2% to $3,016.43 per ounce. U.S. gold futures remained steady at $3,020.80. Gold had reached a record high of $3,057.21 per ounce on Thursday.
The dollar index hovered near a three-week high, making gold more expensive for international buyers. Tim Waterer, chief market analyst at KCM Trade, noted that gold remains well-positioned for further gains if markets remain uneasy about potential economic consequences from tariffs. However, this momentum could be dampened if a ceasefire deal between Russia and Ukraine comes closer.
On Monday, a U.S. delegation will continue talks with Russia over a Black Sea ceasefire and broader peace in Ukraine. Meanwhile, a recent Israeli airstrike on a hospital in Gaza killed five people, including a Hamas leader.
U.S. President Donald Trump announced reciprocal tariffs set to begin on April 2, which could drive inflation and slow economic growth. However, Trump indicated on Friday that the tariffs might not be as severe as initially expected, easing some market concerns but reducing gold’s upward momentum.
Gold, often seen as a safe haven against geopolitical unrest, economic instability, and inflation, remains a popular choice for investors. Last week, the U.S. Federal Reserve held its interest rate steady at 4.25%-4.50%, with expectations for two rate cuts by the end of 2025.
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