Gold prices steady amid US-China talks kept markets cautious on Tuesday. Investors watched closely as the second day of trade negotiations unfolded in London. Spot gold held firm at $3,330.46 an ounce early Tuesday morning. Meanwhile, U.S. gold futures remained stable, trading near $3,350.30.
The dollar index strengthened by 0.2%, making gold more expensive for holders of other currencies. This limited gold’s upside despite ongoing geopolitical tensions. Traders focused on whether the US-China talks would produce meaningful results.
Trade talks between the world’s two biggest economies cover key issues, including tariffs and rare-earth metal restrictions. U.S. President Donald Trump said the negotiations were going well, which helped ease some market fears. Last month, both countries agreed to pause tariffs temporarily, providing relief to investors.
Tim Waterer, chief market analyst at KCM Trade, noted that gold prices steady amid US-China talks reflected cautious trading. He said investors awaited clear progress before pushing gold higher. This reserved approach is typical when uncertainty surrounds major economic discussions.
Data released from China showed export growth slowing to a three-month low in May. U.S. tariffs impacted shipments, while factory-gate deflation worsened to the lowest level in two years. These developments added complexity to the trade talks and market sentiment.
Looking ahead, U.S. inflation data due Wednesday will influence Federal Reserve policy expectations. Waterer added that a slight rise in consumer prices would be expected. However, a sharp jump might alarm investors, prompting a flight to safety. That scenario could push gold prices up.
Gold often gains appeal during times of economic uncertainty and tends to do well in low-interest-rate environments. On Tuesday, other precious metals faced downward pressure: spot silver fell 0.5% to $36.55 per ounce, platinum declined 0.4% to $1,211.90, and palladium slipped 0.8% to $1,066.28.
Overall, gold prices steady amid US-China talks signaled that investors remain cautious but ready to act if negotiations improve. Markets will continue to monitor developments closely.
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