Gold prices fell in global and local markets on Thursday. In the global bullion market, the price of gold per ounce fell by $9, reaching the level of $2859.
Domestically, the price of gold also fell. The price of gold tola fell by 900 rupees, reaching 298,700 rupees. Similarly, the price of 10 grams of gold has fallen by 772 rupees, now at 256087 rupees.
The decline in gold prices was observed amid volatile global market conditions. Which affected the value of gold in various regions. Earlier, the price of gold rose significantly in Pakistan. With tola prices rising by 5,300 rupees to a record high of 299,600 rupees. According to data from the Pakistan Gemstone and Smiths Association (APGJSA).).
US President Donald Trump’s comments and escalating trade tensions between the US and China have caused panic among investors, prompting them to turn to gold. As a result, gold prices reached all-time highs on Wednesday.
The significant rise in gold prices is primarily due to fears of a possible new trade war. The escalation began when Beijing imposed tariffs on U.S. imports in response to new U.S. tariffs on Chinese goods. In addition, Trump’s statement about US “control” over the Gaza Strip contributed to these concerns.
US Federal Reserve officials also pointed to significant political uncertainty over tariffs and issues arising from the early days of the Trump administration as among the main challenges in determining the direction monetary policy should take in the coming months.
The market is now focused on the weekly jobless claims data in the US, due at 1330 GMT. And Friday’s nonfarm payrolls report, which could provide insights into the overall strength of the economy.
Spot silver fell 1.3% to $31.91 an ounce, and palladium fell 0.4% to $985.48. Platinum rose 0.2% to $981.74.
Gold consolidates near record high amid trade tensions
Gold consolidates near record peak as trade tensions support safe-haven demandPosted two hours ago on February 6, 2025
Gold prices fell on Thursday as the dollar regained some of its strength, although concerns over the U.S.-China trade war kept safe-haven gold near a record high hit in the previous session.
Spot gold fell 0.4% to $2,854.39 an ounce by 0802 GMT. After hitting an all-time high of $2,882.16 in the previous session, Reuters reported.
U.S. gold futures fell 0.6% to $2,875. The dollar index, which measures the greenback against six major rivals, rose 0.2%.
Sonny Kumari, commodities strategist at ANZ Bank, said: “Investors try not to miss this rally as they place their positions because they are happy with the returns. This is why gold has reached consecutive high levels.”
“The bullion may reach the $3,000 level soon… However, what may make the market consolidate is some clarity on trade relations or easing trade tensions.”
On Wednesday, China filed a complaint with the World Trade Organization against new 10% tariffs imposed by US President Donald Trump on Chinese imports.
The trade war between the world’s two largest economies could affect global growth and push inflation higher, benefiting bullion even more as it is considered a safe investment during economic and geopolitical turmoil.
“The bull gold market looks set to continue under Trump 2.0 as trade wars and geopolitical tensions reinforce the trend of reserve diversification/dedollarization and support demand for gold in the formal sector in emerging markets,” Citi said in a note.
“Concerns about global growth are also expected to increase demand for ETFs and OTC investments.”
XAU regains momentum despite weaker economic factors
The price of gold (XAU/USD) erases its previous slide from this Thursday and rises again. Entering its sixth day of gains in the February march. The decline was mainly due to comments from US Treasury Secretary Scott Bescent, who said the Trump administration’s focus is on cutting 10-year Treasury yields. Not the Federal Reserve’s benchmark short-term interest rate, according to Bloomberg reports.
On the economic data front. All eyes will be on the Bank of England’s monetary policy decision. Where a 25 basis point rate cut was implemented, to 4.50% after a 50 basis point cut throughout 2024. The fact that two members voted in favor of a 50 basis point rate cut fuels further belief that the Fed will cut more than markets currently expect. Additionally, Fed Governor Christopher Waller. San Francisco Fed President Mary Daly and Fed Dallas President Laurie Logan will speak later this Thursday, ahead of Friday’s release of nonfarm payroll data.
Markets need to change their stance very quickly, which means gold is not in the right place this Thursday. “Peaceful” comments from US President Donald Trump surprise markets and support a more risky situation. Meaning safe havens are out of favor. With gold clearly being one of those havens, Thursday’s selling pressure may continue until a contradictory headline or comment emerges.
Thursday’s S1 support level is the first close support at $28,343. From there, the S2 support should come in at $2,820. In case of correction, the larger level of $2790 (the previous high on October 31, 2024) should be able to catch any falling knives.
