Gold Pulls Back from Record Highs as Global Trade Relations Improve

Gold prices fell by as much as 1.4%, trading near $3,200 an ounce and extending its weekly loss of approximately 3.5%. This decline follows two main factors: profit-taking after recent gains and reduced safe-haven demand due to improving US-China trade relations.

According to Christopher Wong of Oversea-Chinese Banking Corp, gold is experiencing “fatigue” as reduced trade tensions ease market uncertainty. Despite the current decline, gold has appreciated more than 20% this year and remains an important portfolio diversifier according to UBS Group’s chief investment officer.

The metal’s strong performance has been driven by increased demand for gold-backed ETFs, substantial central bank purchasing, and speculative buying from China. Gold is currently trading about $300 below its recent all-time high.