Lagos — Gold prices slipped on Friday, on track for a weekly loss, as easing global trade tensions reduced demand for safe-haven assets. The US and China agreed to temporarily reduce tariffs for 90 days, limiting concerns over prolonged trade tensions. Optimism over this de-escalation, coupled with an India-Pakistan truce, weighed on gold.
However, geopolitical risks in other regions could affect the market. Expectations around talks between Russia and Ukraine remain low due to the absence of key leaders. If the negotiations show progress, investor sentiment could improve further, pressuring the precious metal. Conversely, any setback could revive safe-haven demand.
On the monetary front, softer US inflation data and weak retail sales figures could reinforce expectations of Federal Reserve rate cuts this year. However, Fed Chair Jerome Powell warned that inflation could become more volatile, complicating the central bank’s policy path and potentially affecting gold.
Meanwhile, gold-backed ETFs recorded a net outflow of 4.4 tons last week, reflecting weaker investor interest. Persistent outflows could heighten selling pressure on gold.
*Wael Makarem Financial Markets Strategists Lead at Exness
