Gold prices edged higher on Wednesday as renewed uncertainty over the finalization of a U.S.-China trade deal spurred safe-haven demand. Investors are now turning their attention to a key U.S. inflation report for further clues on the Federal Reserve’s next move.
Spot gold rose 0.5% to $3,337.99 per ounce as of 05:44 GMT, while U.S. gold futures also gained 0.5%, reaching $3,359.20.
The gains follow two days of negotiations in London, where U.S. and Chinese officials announced they had reached a framework agreement aimed at reviving their stalled trade truce. The deal reportedly includes the removal of China’s export restrictions on rare earths. However, the agreement still requires approval from both Presidents Joe Biden and Xi Jinping.
“We know U.S. and Chinese negotiators have agreed on a ‘framework,’ but until Trump or Xi approves it, uncertainty lingers,” said Matt Simpson, senior analyst at City Index. “And that uncertainty is supporting gold heading into the inflation figures.”
The two countries had previously imposed tit-for-tat tariffs in April, escalating trade tensions into a full-blown trade war. Talks in Geneva last month led to an agreement to reduce tariffs from triple-digit levels.
Adding to global economic concerns, the World Bank on Tuesday cut its 2025 global growth forecast by 0.4 percentage points to 2.3%, citing elevated tariffs and persistent geopolitical uncertainty as major headwinds for nearly all economies.
“Over the short term, gold prices are expected to consolidate before resuming a rally toward $3,600 an ounce by year-end,” analysts at ANZ Research said in a note.
Market participants are now awaiting the U.S. Consumer Price Index (CPI) report, scheduled for release at 12:30 GMT, which could provide more clarity on the Federal Reserve’s monetary policy stance. According to a Reuters poll, most economists expect the Fed to keep interest rates steady for at least the next two months, with inflation risks remaining due to ongoing tariff-related pressures.
In other precious metals, spot silver slipped 0.1% to $36.52 per ounce. Platinum gained 1.4% to $1,238.97, while palladium rose 1% to $1,070.88.
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