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Gold Prices Pull Back from Three-Week High as Dollar Strengthens and Trade Tensions Resurface

Gold Prices Pull Back from Three-Week High as Dollar Strengthens and Trade Tensions Resurface. Source: Image by PublicDomainPictures from Pixabay

Gold prices retreated in Asian trading on Tuesday after reaching a three-week high, as investors locked in profits and the U.S. dollar strengthened amid renewed concerns over U.S. trade tariffs. Despite the pullback, ongoing trade uncertainty and geopolitical risks continue to support the broader outlook for bullion markets.

Spot gold fell 1.1% to $5,172.42 per ounce by 21:20 ET (02:20 GMT), easing from its strongest level since late January recorded earlier in the session. U.S. gold futures declined 0.6% to $5,193.44 per ounce. The precious metal had surged 2.5% in the previous trading session, driven by safe-haven demand as uncertainty surrounding U.S. trade policy intensified.

Silver prices also moved lower, dropping nearly 2% to $86.55 per ounce after posting gains for four consecutive sessions. The broader precious metals market faced pressure as the U.S. Dollar Index edged up 0.1%, recovering earlier losses to finish mostly unchanged on Monday. A firmer dollar typically weighs on gold and silver prices, as it makes commodities priced in dollars more expensive for investors using other currencies.

Investor sentiment remains sensitive to developments in U.S. trade policy. Last week, the U.S. Supreme Court struck down former President Donald Trump’s sweeping tariff measures. However, the administration quickly introduced new tariffs of up to 15%, reigniting fears of escalating global trade disputes. Trump further warned that countries attempting to “play games” with U.S. trade agreements could face even higher tariffs, signaling potential additional trade restrictions ahead.

Geopolitical tensions are also in focus, with the United States and Iran scheduled to hold a third round of nuclear talks in Geneva on Thursday. Ongoing regional strains and diplomatic uncertainty continue to fuel safe-haven interest in gold.

While gold prices have paused after recent gains, persistent trade tensions, a fluctuating U.S. dollar, and geopolitical risks may continue to influence the direction of the precious metals market in the near term.

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