Gold prices continued to plummet sharply during trading on Thursday, with contracts for the yellow metal trading at their lowest levels in two weeks, following comments from Trump that increased hopes for a delay in the tariffs that the White House plans to impose on Canada and Mexico.
In trading activity, spot gold prices fell by 1.12% or $33, with one ounce of gold trading at $2,883.84, while April futures gold contracts declined by 1.15% to $2,896.69 per ounce. These levels mark the lowest recorded for gold contracts since February 14.
U.S. Treasury yields rose significantly during today’s trading, with yields on the 10-year standard Treasury bonds increasing by 1.2% to 4.3%, which bolstered demand for the U.S. dollar, causing the U.S. dollar index to rise by 0.15%. This led to a decrease in interest for gold priced in greenbacks, as its holding costs increased.
The drop in gold prices today also followed losses in bullion yesterday due to recent profit-taking activities, wiping out all gains gold had achieved since the beginning of the week and heading towards its first weekly loss after eight weeks of profits.
Gold losses come amid a decline in market fears regarding the likelihood of an imminent global trade war, after Trump announced yesterday that the 25% tariffs set to be imposed by the United States on Canada and Mexico will take effect on April 2, instead of the initially scheduled date of March 4.
Markets are currently awaiting the release of the second estimate for GDP growth for the fourth quarter in the United States later today, one day ahead of personal consumption expenditures price index data on Friday, which is the preferred inflation measure for the U.S. Federal Reserve.
