Gold Shines Amid Dollar Dip and US-China Trade Talks

London, June 9, 2025 — Gold prices edged higher on Monday, buoyed by a softer U.S. dollar as global markets focused on upcoming U.S.-China trade talks in London aimed at easing bilateral tensions. The precious metal saw a 0.3% increase to $3,317.97 per ounce by 1124 GMT, recovering from an earlier dip to $3,293.29, its lowest since June 2.

Meanwhile, platinum surged to a four-year high, climbing 2.7% to $1,200.95, driven by tight supply expectations and a broader rally in precious metals. Investors are closely monitoring economic indicators and geopolitical developments for clues on future market trends.

Dollar Weakness Fuels Gold's Appeal

The U.S. dollar weakened by 0.2% against a basket of major currencies, making gold more affordable for investors holding other currencies. A weaker dollar typically boosts demand for bullion, which is priced in dollars.

Giovanni Staunovo, an analyst at UBS, noted that ongoing trade and geopolitical tensions, coupled with concerns over global debt and sluggish economic growth, continue to underpin gold’s safe-haven status. U.S. gold futures, however, slipped slightly by 0.2% to $3,338.70, reflecting cautious market sentiment ahead of key economic data.

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US-China Trade Talks and Market Dynamics

High-level U.S. and Chinese officials are meeting in London on Monday to address escalating trade disputes, with markets hopeful for progress but wary of entrenched differences. Gold, often a hedge against economic and political uncertainty, benefits from such tensions. Additionally, stronger-than-expected U.S. non-farm payrolls data released recently have tempered expectations for Federal Reserve interest rate cuts, with markets now anticipating only one cut in October instead of two.

Investors are awaiting the U.S. Consumer Price Index (CPI) data, due Wednesday, for further insight into the Fed’s monetary policy direction. Lower interest rates typically enhance gold’s appeal, as it yields no interest.

Did you know?
Gold has been a store of value for over 5,000 years, with ancient civilizations like the Egyptians using it for currency and adornment as early as 3100 BCE.

Platinum and Other Precious Metals Surge

Platinum’s rally continued for a sixth consecutive session, reaching its highest level since May 2021 at $1,200.95. Alexander Zumpfe, a trader at Heraeus Metals Germany, attributed the surge to constrained supply, improving industrial demand, and momentum from the broader precious metals market.

Spot silver also gained, rising 0.9% to $36.27 per ounce, while palladium advanced 2.5% to $1,072.96. China’s central bank further supported the bullish sentiment by adding gold to its reserves for the seventh consecutive month in May, signaling sustained demand from major economies.