Gold inches up as trade uncertainty, inflation worries drive safe-haven demand 

SINGAPORE: Gold prices rose slightly on Wednesday as lingering doubts over a final US-China trade deal pushed investors towards safe-haven assets. Market participants are also eyeing key US inflation data due later in the day for signals on the Federal Reserve’s next move. 

As of 0153 GMT, spot gold was up 0.2 per cent at $3,328.89 an ounce, while US gold futures also gained 0.2 per cent to $3,349.80. 

The cautious optimism in markets follows comments from US Commerce Secretary Howard Lutnick, who said negotiators from both sides had agreed on a framework to revive the trade truce and resolve China’s export curbs on rare earths and magnets. The announcement came after two days of high-level talks in London. 

Lutnick noted that the US team would now present the deal to President Donald Trump for approval, while the Chinese side would seek a green light from President Xi Jinping. 

“We know there’s a ‘framework’ in place, but until it’s formally endorsed by Trump or Xi, uncertainty remains. That’s keeping gold supported as traders await inflation data,” said Matt Simpson, senior analyst at City Index. 

Tensions between the two economic giants had escalated in April after both imposed tit-for-tat tariffs, sparking a trade war. Last month’s discussions in Geneva led to an agreement to scale back tariffs, which had reached triple-digit levels. 

Adding to the cautious mood, the World Bank on Tuesday cut its global growth forecast for 2025 to 2.3 per cent, down by 0.4 percentage points, citing higher tariffs and continued uncertainty as major risks for economies worldwide. 

Investors are now focused on the upcoming US consumer price index (CPI) report, expected at 1230 GMT, which could provide clearer direction on the Fed’s interest rate outlook. Most economists surveyed by Reuters expect the Fed to keep rates unchanged for at least the next couple of months, with inflation risks tied to tariff policies still looming. 

In other precious metals, spot silver held steady at $36.53 per ounce. Platinum slipped 0.4 per cent to $1,216.42, while palladium edged up 0.3 per cent to $1,063.62. 

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