Gold rose for a second day on optimism the Federal Reserve will resume rate cuts later this year, while investors continued to monitor US trade talks ahead of a July 9 US tariff deadline.
Bullion traded near $3,310 an ounce, after rising 0.9% on Monday as traders priced in higher odds of at least two US rate reductions in 2025. A jobs report on Thursday also looms as a potential catalyst for a drop in yields on Treasuries — a scenario that typically tends to benefit gold.
Gold is up by about a quarter this year and is trading less than $200 short of April’s record high, supported by elevated trade and geopolitical risks. Uncertainty over the economic impact of Trump’s tariff agenda and a rush to get out of US assets has seen a gauge of the dollar drop almost 11% in the first six months of year, the worst performance since 1973.
“Gold, despite its recent losses, has the most potential to gain in the short term if the US dollar continues to decline,” Commonwealth Bank of Australia analyst Vivek Dhar said in a note.
Spot gold rose 0.3% to $3,311.64 an ounce as of 8:44 a.m. in Singapore. The Bloomberg Dollar Spot Index slipped 0.1%, after falling 0.5% Monday.
Platinum climbed 0.6% to $1,367.10 an ounce after surging almost 29% in June, its best ever monthly performance. The rally has been driven by signs of extreme tightness in the spot market amid strong demand from Chinese jewelry manufacturers, as well as speculative buying led by the US and China. Silver and palladium also advanced.
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