Gold plunges to 3-1/2-week low

Gold Prices Plummet Amid US-China Trade War Tensions

Gold prices continued to face turmoil on Monday, hitting their lowest levels in more than three weeks, as a wider market sell-off triggered by US President Donald Trump’s tariff measures impacted bullion traders.

Market Insights

Spot gold was down 1.9 per cent at US$2,981.09 an ounce, as of 0031 GMT, its lowest level since March 13. Bullion hit a record high of US$3,167.57 on April 3.

US gold futures fell 1.3 per cent to US$2,997.40.

Impact on Investors

Gold dropped more than 3 per cent on Friday as investors sold off bullion to cover their losses from a wider market meltdown as an intensifying trade war sparked concerns of a global recession.

Speculation and Cycle

The drop in prices made dealers speculate that investors might be selling off gold to realise profits, potentially covering losses or margin calls on other assets. This could trigger a cycle, with more investors selling, further driving down prices in a negative feedback loop.

Global Market Developments

China on Friday struck back at the US tariffs imposed by Trump with a slew of counter-measures including extra levies of 34 per cent on all US goods and export curbs on some rare-earths, deepening the trade war between the world’s two biggest economies.

Other Metals

In other metals, spot silver retreated 2.8 per cent to US$28.74 an ounce, marking to its lowest level in nearly seven months.

Spot platinum eased 1.7 per cent to US$900.70 and palladium lost 2.6 per cent to US$888.00.

Conclusion

The ongoing US-China trade war has sent gold prices tumbling, with investors selling off bullion to cover losses and potentially triggering a negative feedback loop. The impact of the trade war on global markets is far-reaching, and it remains to be seen how bullion prices will recover in the coming days.

FAQs

Q: What is the current price of gold?

A: As of 0031 GMT, spot gold was down 1.9 per cent at US$2,981.09 an ounce.

Q: What is the impact of the US-China trade war on gold prices?

A: The trade war has triggered a wider market sell-off, leading to a decline in gold prices as investors sell off bullion to cover losses.

Q: How have other metals been affected?

A: Silver, platinum, and palladium have also seen significant declines, with spot silver retreating 2.8 per cent to US$28.74 an ounce and spot platinum easing 1.7 per cent to US$900.70.

Share with us your feedback on BT’s products and services