Gold is dropping due to progress in peace talks, US-China trade negotiations

From Yahoo Finance: 2025-05-16 14:40:00

Gold is on track for its largest weekly drop in six months, falling 4% to around $3,190 an ounce. Russia and Ukraine held their first direct talks in over three years, reaching agreements on prisoners and a potential ceasefire. Progress in US-China trade negotiations also contributed to the decline in demand for gold.

The precious metal has fallen over $300 from its peak last month but is still up more than 20% this year. Factors driving gold’s rise include demand for exchange-traded funds, central bank purchases, and speculation from Chinese buyers. Ongoing volatility in US markets may prompt more investors to hedge their dollar exposure with gold.

Spot gold fell 1.7% to $3,185.50 an ounce in New York, with the Bloomberg Dollar Spot Index rising. Other precious metals like silver, palladium, and platinum also saw declines. Despite the recent drop, gold remains an important diversifier for international investors looking to globally diversify their asset allocations.



Read more at Yahoo Finance: Gold Set for Biggest Weekly Drop Since November on Peace Talks