Gold Eases as Dollar Strengthens Ahead of US Tariff Decision

Gold prices declined on Monday, slipping to their lowest level in nearly a week, as a stronger US dollar weighed on the precious metal ahead of a key tariff deadline set by the Trump administration, Reuters reports.

By 08:45 GMT, spot gold had fallen 0.8% to $3,309.09 per ounce, while US gold futures dropped 0.7% to $3,319.

The US dollar rose 0.4% against a basket of major currencies, making gold more expensive for holders of other currencies and contributing to the decline in demand for the metal.

“We are seeing a slight pullback due to short-term positive dollar momentum, and that may be driven by stronger-than-expected US economic data,” said Nitesh Shah, commodities strategist at WisdomTree.

He added that the robust job market has reduced the urgency for the US Federal Reserve to cut interest rates, limiting gold’s appeal as a non-yielding asset.

Last week’s US labor market report showed unexpectedly solid job growth in June. Coupled with growing concerns about inflation linked to trade tensions, these developments have led investors to reassess expectations for rate cuts from the Fed. Market participants will closely monitor the minutes from the Fed’s latest meeting, due later this week, for further insight into the central bank’s policy direction.

Meanwhile, trade policy remains a key focus. President Donald Trump said on Sunday that the US is close to finalizing several trade deals and will notify countries of higher tariff rates by July 9, with those increases set to take effect on August 1. Trump also reiterated plans for a 10% base tariff on most imports and threatened an additional 10% tariff on countries aligning with the BRICS bloc’s “anti-American policies.”

According to Shah, the expiration of the 90-day reduced tariff period, combined with limited progress on new trade agreements, may hurt global trade activity.

“That’s not supportive for the economy, which could ultimately be supportive for gold in the longer term,” he said.

In other metals, spot silver fell 0.9% to $36.56 per ounce, platinum declined 2.5% to $1,357.25, and palladium dropped 2.1% to $1,111.21.