Gold Retreats from Record Highs as U.S.-China Relations Improve

Gold prices fell by 0.5% to $3,231.08 per ounce on Wednesday as improving U.S.-China trade relations eased global recession concerns. The two countries agreed to a 90-day suspension of reciprocal tariffs after weekend talks in Geneva, with the U.S. planning to reduce tariffs on low-value Chinese shipments to 30%.

This agreement has boosted investor risk appetite and weakened gold’s safe-haven appeal, which had previously driven prices to a record high of $3,500.05 last month. According to Ole Hansen from Saxo Bank, gold faces potential further decline if prices drop below $3,200, potentially testing the $3,165 level.

Meanwhile, traders await Thursday’s U.S. producer price index data for insights into the Federal Reserve’s interest rate plans, with markets currently expecting 53 basis points of rate cuts beginning in September.