عربي English Türkçe اردو فارسى
Logo
Latest News
Business

Gold Firms as US Rate-cut Optimism, Geopolitical Risks Lend Support

Ingots of 99.99 percent pure gold are placed in a workroom at the Novosibirsk precious metals refining and manufacturing plant in the Siberian city of Novosibirsk, Russia, September 15, 2023. REUTERS/Alexander Manzyuk/FILE PHOTO Purchase Licensing Rights
Ingots of 99.99 percent pure gold are placed in a workroom at the Novosibirsk precious metals refining and manufacturing plant in the Siberian city of Novosibirsk, Russia, September 15, 2023. REUTERS/Alexander Manzyuk/FILE PHOTO Purchase Licensing Rights
TT
20
TT

Gold Firms as US Rate-cut Optimism, Geopolitical Risks Lend Support

Ingots of 99.99 percent pure gold are placed in a workroom at the Novosibirsk precious metals refining and manufacturing plant in the Siberian city of Novosibirsk, Russia, September 15, 2023. REUTERS/Alexander Manzyuk/FILE PHOTO Purchase Licensing Rights
Ingots of 99.99 percent pure gold are placed in a workroom at the Novosibirsk precious metals refining and manufacturing plant in the Siberian city of Novosibirsk, Russia, September 15, 2023. REUTERS/Alexander Manzyuk/FILE PHOTO Purchase Licensing Rights

Gold prices drifted higher on Wednesday driven by safe-haven demand and rising bets that the US Federal Reserve might reduce interest rates as early as September.

Spot gold rose 0.6% to $2,402.43 per ounce, as of 1242 GMT, having settled lower in the previous four sessions. US gold futures gained 0.5% to $2,442.70.

Gold is seeing some "stabilization as some interest develops in the physical gold markets in the far East; geopolitical tensions are still supportive," said StoneX analyst Rhona O'Connell, Reuters reported.

"It's possible that some distressed sellers from the weekend/Monday will be looking to re-establish their positions as gold has done its usual job by providing liquidity ahead of potential margin calls."

Prices fell as much as 3% on Monday, caught in a global sell-off driven by fears of a US recession.

Bullion is considered a hedge against geopolitical and economic uncertainties and tends to thrive in a low-interest-rate environment.

Traders have altered their rate cut expectations following the soft jobs report last week, with nearly 105 basis points of cuts anticipated by year-end and a 100% chance of a rate cut in September, according to the CME FedWatch Tool.

The outlook for looser monetary policy provides a supportive element for gold as a non-yield-bearing asset, and this factor has combined with strong central bank buying to deliver a positive performance for the yellow metal in 2024 so far, Kinesis Money said in a note.

Meanwhile, China's central bank held back on buying gold for its reserves for a third straight month in July, official data showed.

Spot silver edged 0.1% lower to $27.02 per ounce.

The expected economic slowdown will dent industrial demand and that is likely to cap the upside for silver, said Ricardo Evangelista, senior analyst at ActivTrades.

Platinum rose 1.8% to $928.25 and palladium was up 2.5% to $896.65.

 

 

 

Most Viewed

 
Business

China Exempts Some Goods from US Tariffs to Limit trade War Pain

TOPSHOT - An aerial view shows cargo containers stacked at a port in Shanghai on April 20, 2025. (Photo by AFP) / China OUT
TOPSHOT - An aerial view shows cargo containers stacked at a port in Shanghai on April 20, 2025. (Photo by AFP) / China OUT
TT
20
TT

China Exempts Some Goods from US Tariffs to Limit trade War Pain

TOPSHOT - An aerial view shows cargo containers stacked at a port in Shanghai on April 20, 2025. (Photo by AFP) / China OUT
TOPSHOT - An aerial view shows cargo containers stacked at a port in Shanghai on April 20, 2025. (Photo by AFP) / China OUT

China has exempted some US imports from its 125% tariffs and is asking firms to identify critical goods they need levy-free, according to businesses notified, in the clearest sign yet of Beijing's concerns about the trade war's economic fallout.

The dispensation, which follows de-escalatory statements from Washington, signals that the world's two largest economies were prepared to rein in their conflict, which had frozen much of the trade between them, raising fears of a global recession.

Beijing's exemptions - which business groups hope would extend to dozens of industries - pushed the US dollar up slightly and lifted equity markets in Hong Kong and Japan.

“As a quid-pro-quo move, it could provide a potential way to de-escalate tensions," said Alfredo Montufar-Helu, a senior adviser to the Conference Board's China Center, a think tank.

But, he cautioned: "It’s clear that neither the US nor China want to be the first in reaching out for a deal."

China has not yet communicated publicly on any exemptions. A Friday statement by the Politburo, the Communist Party's elite decision-making body, focused on efforts to maintain stability at home by supporting firms and workers most affected by tariffs.

The readout, which followed the Politburo's regular monthly meeting, showed that Beijing was also ready to hunker down and fight a trade war of attrition if needed to outlast Washington in enduring the pain from the breakdown of their relationship.

A Ministry of Commerce taskforce is collecting lists of items that could be exempted from tariffs and is asking companies to submit their own requests, according to a person with knowledge of that outreach.

The ministry said on Thursday it had held a meeting with more than 80 foreign companies and business chambers in China to discuss the impact of US tariffs on investment and the operation of foreign firms in the country.

"The Chinese government, for example, has been asking our companies what sort of things are you importing to China from the US that you cannot find anywhere else and so would shut down your supply chain," American Chamber of Commerce in China President Michael Hart said.

Hart added some member pharmaceutical companies had reported being able to import drugs to China without tariffs. He believed the exemptions were drug-specific, not industry-wide.

The chief executive of French aircraft engine maker Safran said on Friday it had been informed last night that China had granted tariff exemptions on "a certain number of aerospace equipment parts" including engines and landing gear.

The tariff exemptions under consideration by Beijing could provide cost relief for companies in China and take pressure off US exports at a time when the Trump administration has shown signs of wanting to make a deal with Beijing.

The European Union Chamber of Commerce in China also said it had raised the issue of tariff exemptions with the commerce ministry and was awaiting a response.

"Many of our member companies are significantly impacted by the tariffs on critical components imported from the US," President Jens Eskelund said.

A list of 131 categories of products said to be under consideration for tariff exemptions was circulating on Chinese social media platforms and among some businesses and trade groups on Friday. Reuters could not verify the list, which included items ranging from vaccines and chemicals to jet engines.

Huatai Securities said the list corresponded to $45 billion worth of imports to China last year.

China's customs agency and Ministry of Commerce did not reply to requests for comment. China's foreign ministry said it was not familiar with tariff exemption plans, redirecting queries to "relevant authorities".