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Gold Falls off 4-Week Highs as Trump Officials Tout China Talks Again

Investing.com – The Trump administration’s trade ping-pong with the Chinese is back to haunt gold bulls. Gold backed off from four-week highs on Wednesday as markets returned to a risk-on mode after Trump Administration officials said the U.S. remained in talks with the Chinese, just a day after President Donald Trump said a deal was unlikely until after 2020.

Gold futures for February delivery on New York’s COMEX settled down $4.20, or 0.3%, at $1,480.20 per ounce. It hit a 4-week high of $1,487.65 in the previous session as investors rushed to look for a hedge as markets tanked.

Spot gold, which tracks live trades in bullion, was down $2.01, or 0.1%, at $1,475.23 by 3:25 PM ET (20:25 GMT). It reached a four-week peak of $1,481.90 on Tuesday.

Anonymous officials within the Trump administration said Trump’s comments Tuesday downplaying the urgency of a deal shouldn’t be understood to mean the talks were stalling, as he was speaking off the cuff, Bloomberg reported.

U.S. negotiators expect a phase one deal with China to be completed before American tariffs are set to rise on Dec. 15, according to the officials. Outstanding issues in the talks include how to guarantee China’s purchases of U.S. agricultural goods and exactly which tariffs to roll back, they added.

Some precious-metals analysts said gold’s modest declines on Wednesday was an indication that not many were buying what the Trump Administration was saying.

”The trade-related Twitter index has room to grow as we approach Dec 15 without a phase one deal signed as of yet,” analysts at TD Securities said. “In this context, we're confident that the fundamental backdrop will result in higher (gold) prices into next year.”

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