Gold Price Forecast: XAU/USD posts modest gains above $3,150 on better risk appetite
Gold price recovers some lost ground to around $3,180 in Thursday’s early Asian session.
Easing tensions in the global trade war undermines the Gold price.
US April Retail Sales and PPI reports will be in the spotlight later on Thursday.
The Gold price (XAU/USD) trades with mild gains near $3,180 during the early Asian session on Thursday. However, the potential upside for the yellow metal might be capped in the near term due to better risk appetite and progress in trade talks.
The precious metal remains on the defensive as tension eases in the global trade war, pushing investors away from safe-haven demand. The US and China agreed to reduce tariffs on each other after two days of negotiations in Geneva, Switzerland. The US lowered tariffs on Chinese imports to 30% from 145%, while China cut tariffs on US imports to 10% from 125%.
“Overall it’s an improved risk sentiment that for now has reduced gold’s appeal,” said Ole Hansen, head of commodities strategy at Saxo Bank A/S.
A top adviser to Iran’s supreme leader, Ali Shamkhani, said late Wednesday that Iran is ready to sign a nuclear deal with certain conditions with US President Donald Trump in exchange for lifting economic sanctions. These positive developments contribute to the Gold’s downside.
However, trade uncertainties and escalating geopolitical risks could help limit the Gold’s losses. Traders will keep an eye on the release of the US Retail Sales and Producer Price Index (PPI) for April later on Thursday. Also, the Federal Reserve (Fed) Chair Jerome Powell is set to speak.
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