Gold prices edged lower on Monday after reaching a three-week high, as traders focused on ongoing trade talks and upcoming U.S. economic data.
Spot gold fell 0.1% to \$3,350.97 per ounce by early afternoon (EDT), following its highest level since June 23 earlier in the session.
U.S. gold futures also closed down 0.1% at \$3,359.10.
The U.S. dollar hit a near three-week peak, making gold more expensive for holders of other currencies, which contributed to some profit-taking.
Bart Melek, head of commodity strategies at TD Securities, noted that despite some selling after the price surge, the gold market remains well-supported overall.
Trade tensions remain a key factor, as the European Union and South Korea announced negotiations on trade deals with the U.S., even as President Donald Trump escalated his trade war by threatening a 30% tariff on imports from the EU and Mexico starting next month.
Investors are now awaiting U.S. inflation data, including Tuesday’s Consumer Price Index and Wednesday’s Producer Price Index, for clues on the Federal Reserve’s future policy decisions.
Melek added that President Trump’s calls for lower interest rates support gold, which is attractive in a low-rate environment since it does not yield interest.
Meanwhile, spot silver remained steady at \$38.36 per ounce, earlier hitting its highest level since September 2011.
Nitesh Shah, commodities strategist at WisdomTree, said silver benefits from strong fundamentals, including supply deficits and robust demand, especially in the solar industry.
The gold-to-silver ratio is also tightening, approaching 86 as silver’s performance catches up with gold.
Elsewhere, platinum prices fell 1.5% to \$1,378.86 and palladium dropped 1.9% to \$1,192.56, after both had reached more than eight-month highs earlier in the day.
