Spot gold fell 0.6% to $3,361.24 an ounce, while gold futures for August delivery declined 0.4% to $3,384.92 per ounce by 00:32 ET (04:32 GMT). The retreat comes after bullion surged over 2% on Monday, buoyed by a flurry of global risk events that intensified demand for safe-haven assets.
The week began with renewed conflict in Eastern Europe, as Ukraine launched a deadly drone attack on Russia, casting a shadow over peace talks held just a day earlier. Moscow’s response showed little willingness to pursue a lasting ceasefire, further fueling geopolitical concerns.
In the Middle East, U.S.-Iran nuclear negotiations appeared to stall after U.S. President Donald Trump reiterated that Tehran would not be allowed to enrich uranium. Reports in May also suggested that Israel was preparing military action against Iran if diplomacy failed, heightening regional instability.
Profit-Taking and Dollar Rebound Weigh on Metals
Tuesday’s pullback in gold prices was attributed in part to short-term profit-taking, as well as a modest recovery in the U.S. dollar. The greenback bounced off a six-week low, applying pressure on precious and industrial metals across the board.
Despite the decline, gold retained most of its recent gains. Analysts noted that persistent geopolitical risks and concerns over the global economic impact of U.S. trade policies continue to support safe-haven demand. Trade tensions between Washington and Beijing remain unresolved, while market anxiety has grown over a proposed tax cut bill—championed by Trump—that recently gained traction in Congress.
Bond markets also reflected investor unease, with U.S. Treasuries facing selling pressure amid concerns over mounting U.S. debt levels. The weakening bond market further fueled gold’s rise on Monday.
In other precious metals, platinum futures slipped 0.3% to $1,061.20 an ounce, while silver futures dropped 1.1% to $34.323 an ounce.
Copper Slumps as Chinese Manufacturing Data Disappoints
Among industrial metals, copper prices fell sharply on Tuesday after weak manufacturing data from China, the world’s top copper consumer, stoked fears of slowing demand.
Benchmark copper futures on the London Metal Exchange dropped 0.5% to $9,550.20 per ton, while U.S. copper futures tumbled 2.5% to $4.7345 per pound.
The declines followed a disappointing Caixin purchasing managers index (PMI) report, which showed a deeper-than-expected contraction in China’s manufacturing sector in May. The figures echoed a similar downturn reflected in official government data released last week.
Analysts said the PMI results reinforced concerns that the ongoing U.S.-China trade war is weighing heavily on Chinese industrial activity, raising the prospect of weaker demand for copper in the months ahead.
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