Gold falls as easing Sino-US trade woes dulls safe-haven appeal

Gold prices edged lower on Wednesday as softening trade tension between the U.S. and China weakened safe-haven demand, while markets eyed another set of inflation data to assess the Federal Reserve’s policy path.

FUNDAMENTALS

* Spot gold fell 0.1% to $3,246.21 an ounce as of 0029 GMT. U.S. gold futures rose 0.1% to $3,250.50.

* The U.S. will cut the “de minimis” tariff for low-value shipments from China to 30%, per a White House executive order and industry experts, further de-escalating a potentially damaging trade war between the world’s two largest economies.

* On Monday, U.S. President Donald Trump said he does not see tariffs on Chinese imports returning to 145% after the 90-day pause, adding that he believes Washington and Beijing will have a deal.

* Meanwhile, the United States Department of Labour said the consumer price index increased 0.2% in April, while economists polled by Reuters expected a 0.3% rise after the 0.1% decline in March. * Traders are waiting for the Producer Price Index data, due on Thursday, for cues into the Fed’s rate trajectory. * They are expecting 53 basis points of interest rate cuts this year from September.

* Gold, traditionally seen as a hedge against inflation, thrives in a low-rate environment.

* On Tuesday, Trump reiterated his call for the Fed to lower rates, saying prices for gas, groceries and “practically everything else” are down.

* Spot silver eased 0.3% to $32.80 an ounce, platinum fell 0.1% to $987.55 and palladium lost 0.8% to $949.26.

DATA/EVENTS (GMT) 0600 Germany HICP Final YY Apr