Gold prices declined for a second consecutive day as investor appetite for safe-haven assets weakened amid signs of easing global trade tensions and a modest recovery in the U.S. dollar. U.S. gold futures lost 1.3%, extending a recent pullback after hitting an all-time high last week.
The downturn followed President Donald Trump’s announcement of executive orders aimed at softening the economic impact of tariffs on foreign-made vehicles and imported auto parts used in U.S. manufacturing. The move was seen as a sign of de-escalation in trade tensions, which had previously driven strong demand for gold. Trump also pointed to ongoing negotiations with several countries, including China, although Beijing denied any formal talks.
Meanwhile, the dollar strengthened slightly against a basket of major currencies, making gold more expensive for foreign buyers. Analysts say the uptick in the greenback contributed to some profit-taking after gold's sharp rally earlier in April.
Despite weaker U.S. economic data - such as a drop in consumer confidence to its lowest level in nearly five years and a decline in job openings - investors remain cautious. Attention is now turning to key economic indicators, including personal consumption expenditures (PCE) and Friday’s non-farm payrolls report, which could influence expectations for future Federal Reserve interest rate decisions. Traders currently expect the Fed to cut rates by around 95 basis points by the end of the year.
Gold has risen nearly 25% so far in 2025, supported by steady inflows into gold-backed ETFs, central bank purchases, and strong demand from Chinese investors. While recent developments have tempered the rally, uncertainty around inflation, trade policy, and monetary direction continues to lend support to the precious metal in the longer term.