Gold dipped after a three-day rally as US President Donald Trump’s deal with Japan and a report on progress over talks with the European Union allayed trade war concerns that have stoked demand for haven assets.
Bullion retreated as much as 1.4% after Trump said he would impose 15% levies on goods from Japan, while the Financial Times reported that the US and EU were closing in on a similar deal. The terms with Japan were better than most investors expected, following fraught negotiations.
Commerce Secretary Howard Lutnick said earlier that Japan’s pledge of hundreds of billions in US investments “could be” a model for the EU. Investors will also continue to seek clarity on the progress of trade negotiations with several other countries including China.
Gold has climbed almost 30% this year, as uncertainty around Trump’s aggressive attempts to reshape global trade and conflicts in Ukraine and the Middle East sparked a flight to safety. The precious metal has consolidated within a tight range over the past few months, though this week’s gains of about 1% have pushed prices roughly $100 short of April’s record high above $3,500 an ounce.
Spot gold traded was down 1.3% at $3,385.81 an ounce as of 12:17 p.m. in New York. The Bloomberg Dollar Spot Index was lower. Platinum and palladium fell.
Silver, meanwhile, fell slightly after reaching the highest since 2011 earlier Wednesday. The white metal has advanced 36% this year, with gains recently outpacing gold.
Unlike gold, silver is mostly used as an industrial input. That source of demand has grown in recent years, particularly for its application in solar cells. Solar photovoltaics accounted for nearly 200 million ounces of demand in 2024, quaduple the level of a decade before, according to figures from the Silver Institute. Against that backdrop, the market is headed for a fifth year in deficit, according to the indusry group.
There has also been evidence of tightness in the London market, the dominant trading venue for spot silver, after nearly half a million ounces flooded into US warehouses on tariff fears. The cost of borrowing the metal has jumped above historical norms, while growing exchange-traded fund holdings further erode the amount of metal freely available to buy.
The higher-than-expected 50% US tariff on copper also jolted the silver market, leading to US premiums for the white metal jumping to 80 cents an ounce, before paring back. Silver has been exempted from tariffs, but the high tax on another industrial metal highlighted the tail risk of futures levies.
US front-month copper futures are now trading at a record premium over LME prices, with the gap reaching about $2,900 a ton on Wednesday. That’s nearly 30% above the price in London. The metal was up 0.1% on the LME at $9,926 a ton. Aluminum edged lower, while nickel rose and zinc was flat.
With assistance from Sybilla Gross.
This article was generated from an automated news agency feed without modifications to text.
