Gold slips below $4,000 per ounce as US-China trade progress cools safe-haven demand

Gold prices fell below $4,000 per ounce on Monday as signs of a thaw in U.S.-China trade tensions reduced some of bullion’s safe-haven appeal, while market participants awaited the Federal Reserve’s interest rate decision this week.

Spot gold was down 2.9% at $3,990.89 per ounce at 10:51 a.m. ET (1413 GMT). U.S. gold futures for December delivery were down 3.2% at $4,005.20.

“A potential U.S.-China trade deal portends a little less need for safe-haven assets such as gold,” said David Meger, director of metals trading at High Ridge Futures.

Gold climbed to a record high of $4,381.21/oz on October 20, but retreated 3.2% last week following hints of easing trade tensions between the world’s two largest economies. Negotiators from the U.S. and China on Sunday outlined the framework for a deal to pause steeper American tariffs and defer China’s rare-earth export controls.

U.S. President Donald Trump and China’s Xi Jinping are expected to meet on Thursday to further discuss a trade accord.

In addition to technical selling, gold is “seeing a further decline because of an unwinding of trade tensions that had taken prices from $3,800 to $4,400 over the course of the first three weeks of October,” said CPM Group managing partner Jeffrey Christian.Meanwhile, the market sees a 97% chance of a quarter of a percentage point rate cut at the Fed’ meeting on Wednesday.Gold, as a non-yielding asset, typically performs well in a low interest rate environment.

While most analysts and investors see further highs for the yellow metal, even bringing $5,000/oz into view, some are sceptical about the sustainability of its recent huge rise.

Capital Economics analysts on Monday lowered their gold price forecast to $3,500/oz for end-2026.

“The 25% jump in prices since August is much more difficult to justify than previous moves during the gold rally,” it said.

Spot silver fell 4.8% to $46.28 per ounce, platinum eased 1.1% to $1,587.92, and palladium lost 2.6% to $1,391.34.