FX.co ★ Gold on Track for 3% Weekly Drop

Gold prices declined to approximately $3,220 per ounce on Friday, poised to record a weekly drop exceeding 3%. This decrease can be attributed to the reduction in demand for gold as a safe-haven asset, following the easing of global trade tensions. The recent agreement between the United States and China to temporarily reduce tariffs for a period of 90 days has alleviated fears regarding the ongoing impact of their trade disputes. Additionally, geopolitical tensions appeared to have lessened, as evidenced by the stable ceasefire between India and Pakistan, although there have been indications of stalled progress in the negotiations between Russia and Ukraine. Meanwhile, the usually favorable low inflation data from the United States has bolstered expectations that the Federal Reserve will implement at least two interest rate cuts within the year. Nonetheless, Fed Chair Jerome Powell has issued a warning that future inflation could become more unpredictable due to frequent supply disruptions, potentially complicating the central bank's task of ensuring price stability.