Gold prices declined on Tuesday as investors awaited further updates from ongoing U.S.-China trade negotiations in London, which have now extended into a second day.
In Dubai, 24-carat gold slipped by AED0.41 to close at AED399.16. Similarly, 22-carat gold fell to AED369.57, 21-carat gold was priced at AED352.76, and 18-carat gold reached AED302.37.
Globally, spot gold dropped 0.5% to $3,311.16 per ounce as of 01:25 GMT, currently trading slightly above $3,305. Meanwhile, U.S. gold futures fell 0.7% to $3,330.90, now hovering above $3,325. The extended trade discussions between U.S. and Chinese officials are focused on key issues such as tariffs and rare earth element restrictions.
Positive Progress Amid Caution
Reuters quoted Tim Waterer, chief market analyst at KCM Trade, who said, “With these key U.S.-China trade talks still in the works, gold is trading reservedly until we see what, if any, progress is made between the two global superpowers.” U.S. President Donald Trump noted that negotiations are “doing well” and acknowledged positive developments. Last month, both countries agreed to a temporary tariff pause, providing some relief to financial markets.
“If traders leave these talks believing a broader trade deal remains achievable, safe-haven demand for gold could ease,” Waterer added. Meanwhile, Chinese export growth slowed to a three-month low in May due to U.S. tariffs, and factory-gate deflation worsened to its deepest level in two years, signaling economic challenges.
Investors are now turning their attention to Wednesday’s U.S. inflation data for clues on the Federal Reserve’s future monetary policy. Waterer explained, “A slight rise in CPI would be expected, but a sharp increase could raise alarm bells and trigger a flight to safety, boosting gold prices.” Historically, gold performs well during times of geopolitical uncertainty and low interest rates.
Elsewhere in the metals market, spot silver declined 0.6% to $36.51 per ounce, platinum dropped 0.8% to $1,210.46, and palladium slipped 0.2% to $1,071.75.
