Gold prices in the US dropped on Monday after trade talks gained momentum. President Donald Trump announced progress on key trade agreements. This development reduced interest in gold, which usually rises during global uncertainty.
Spot gold declined by 0.7%, landing at $3,311.09 per ounce. At the same time, US gold futures also dropped 0.7%, settling at $3,320.30. The gold prices in the US fell for a second consecutive session due to reduced investor demand for safe assets.
Markets reacted quickly after Trump said several deals neared finalization. He also extended tariff reprieves for many countries. The president confirmed that higher tariffs will still apply to some nations starting August 1. However, he granted a three-week delay to others, calming short-term tensions.
This delay affected investor expectations. Kelvin Wong, a senior analyst, noted that the tariff reprieve triggered intraday weakness in gold. He expects gold prices in the US to hover around $3,320 per ounce for now. Short-term resistance, according to Wong, may appear near the $3,360 level.
Meanwhile, Trump raised new concerns. He stated that the US plans to impose a 10% tariff on countries that support “Anti-American policies” of the BRICS group. However, he did not define these policies clearly. This announcement further complicated the trade outlook.
Investors worry that these tariffs might fuel inflation. Consequently, they lowered their expectations for interest rate cuts by the Federal Reserve. Previously, markets anticipated a cut this month. Now, most traders only expect two small reductions before year-end.
In another move, Trump signed a large tax and spending package into law. Experts estimate that this package will add over $3 trillion to the national debt. This figure increases the total US debt to more than $36 trillion, sparking concern among economists.
Besides gold prices in the US, other precious metals also faced declines. Spot silver dropped by 0.9%, settling at $36.58 per ounce. Platinum lost 2.4%, ending at $1,358.62. Palladium also dipped by 1.9%, reaching $1,113.23.
Investors will continue monitoring developments in trade talks and US fiscal policy. Any changes could further influence precious metals in the short term.