Gold prices saw wild swings on Monday as ongoing US-China trade negotiations sent mixed signals to the market, triggering both selling and safe-haven buying in rapid succession.
📉 Gold Slips Early Despite Weaker Dollar
In early trading, gold futures for August delivery fell sharply, dropping $26.60 to $3,320.00 per ounce. This decline came even as the US dollar weakened, a typically bullish factor for gold—highlighting the unusual market dynamics at play.
The weakness was largely driven by growing optimism surrounding high-level trade discussions in London, where US Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng met to finalize a 90-day suspension of steep tariffs.
📉 Early optimism hurt gold’s safe-haven appeal, as traders interpreted the talks as a sign of potential resolution to long-standing economic tensions between the world’s two largest economies.
📊 China’s Export Collapse Reveals Economic Strain
However, that optimism was soon tempered by harsh economic data. According to Reuters, China’s export growth dropped to a three-month low, while exports to the US plunged 34.5% year-on-year—marking the worst performance since February 2020.
This drastic decline highlighted the economic fallout from the US-China trade war and raised concerns over whether any diplomatic progress would be enough to reverse the damage.
📈 Gold Prices Stage Powerful Comeback
Following an intraday low of $3,313.10, gold reversed sharply. By 2:10 PM ET, August futures were up $22.80 (+0.68%) at $3,356.50, recovering more than $43 in a dramatic session.
This turnaround suggests investors are growing skeptical that the talks will deliver real change, reinforcing gold’s appeal as a hedge against geopolitical uncertainty and economic instability.
💡 What Drove the Gold Rebound?
- Weakening USD added support to gold’s late-session surge.
- Falling Treasury yields signaled risk-off sentiment.
- Ongoing geopolitical tension and poor Chinese trade data revived safe-haven demand.
📉 Investor Sentiment Turns Cautious Again
The shift in tone reflects a broader market realization: While diplomacy may reduce headline risks, the road to economic recovery remains long and uncertain. Markets are now positioning for potential policy responses—including rate cuts or stimulus—should trade progress stall or economic conditions worsen further.
📌 Key Takeaways for Traders
- Gold Price Today (June 9, 2025): Closed at $3,356.50, recovering from a $3,313 low.
- Volatility Alert: $43 intraday swing amid US-China talks.
- Watch Levels: Immediate resistance near $3,378, support around $3,313 and $3,282.
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