Gold prices rebound after heavy losses; U.S.-China tensions resurface

Investing.com-- Gold prices rose Thursday, regaining some ground after two sessions of sharp declines, as renewed U.S.-China trade tensions lifted safe-haven demand while investors awaited key U.S. inflation data.

At 08:20 ET (12:20 GMT), spot gold was up 0.1% at $4,102.70 an ounce, and U.S. Gold Futures climbed 1.3% to $4,117.03 an ounce.

Bullion’s slight rebound comes after slumping more than 5%, to a two-week low of $4,003.39/oz, as investors took profits following recent highs, encouraged by optimism that trade tensions between Washington and Beijing were easing.

U.S.-China trade tensions resurface

Safe-haven gold received a boost Wednesday after a Reuters report said the Trump administration is considering curbing a broad range of software-powered exports to China in retaliation for Beijing’s latest rare earth export restrictions.

The potential escalation reignited concerns over the U.S.–China trade conflict, boosting gold’s appeal.

In parallel, fresh Western sanctions on Russia added further risk impetus. The U.S. on Wednesday imposed its first Ukraine-related sanctions of this term against Russia’s top oil companies, Rosneft and Lukoil.

The European Union also approved its 19th sanctions package on Moscow, including a ban on Russian liquified natural gas imports and listings of dozens more tankers in its “shadow fleet”.

The release of the U.S. Consumer Price Index (CPI) for September, delayed until Friday due to the prolonged government shutdown, has kept markets on edge.

Investors are watching the data closely for clues on the Federal Reserve’s next policy move, with the central bank’s meeting scheduled for next week.

Expectations that the Fed would cut rates again this month and once again later this year have lent some support to bullion. Lower rates reduce the opportunity cost of holding non-yielding assets like gold.

Other metals also rebound; Silver leads gains

Other precious and industrial metals also rebounded on Thursday as a largely steady U.S. dollar provided support.

Silver Futures jumped 2.1% to $48.695 per ounce, while Platinum Futures climbed 4% to $1,614.05/oz.

Benchmark Copper Futures on the London Metal Exchange rose 1.5% to $10,830.00 a ton, while U.S. Copper Futures also gained 1.9% to $5.085 a pound.

Ayushman Ojha contributed to this article