Gold prices have retreated after a four-day rally, as traders took profits following gains spurred by uncertainty surrounding United States trade policy and heightened tensions in the Middle East. Bullion fell as much as 1.6 per cent before paring some losses, coinciding with the return of Chinese traders after the Lunar New Year break. Over the previous four sessions, gold had climbed more than 7 per cent, driven by investors seeking safer assets amid President Donald Trump’s promise of new import tariffs and escalating tensions between the US and Iran.
According to Song Jiangzhen, a researcher at Guangdong Southern Gold Market Academy, market movements within 2 per cent are within the normal range of volatility. Song added that longer-term sentiment remains positive, citing ongoing uncertainty in Iran and the potential for US isolation due to its tariff policies. Trump’s statement regarding an increase in the global import levy to 15 per cent, following the US Supreme Court’s ruling against reciprocal tariffs, has contributed to market confusion.
Christopher Hamilton, head of client solutions for Asia-Pacific excluding Japan at Invesco, noted that tariff headlines keep uncertainty elevated, providing marginal support for gold. However, he added that they have not been sufficient to force a decisive breakout. Hamilton believes that with relatively firm real rates and a strong US dollar, gold is more likely to consolidate than trend aggressively in the near term.
After a historic rout earlier in the month, gold has found support above $US5000 an ounce as investors seek refuge from risk. A wave of speculative buying had pushed a multiyear rally to breaking point, causing bullion to snap back sharply from a record above $US5595 in late January. Gold has since recovered more than half of these losses, despite unusually choppy trading. As of 10:55 a.m. Singapore time, gold fell 0.8 per cent to $US5185.43 an ounce.
