Gold prices drop 1.09% due to concerns over DeepSeek AI, but XAU/USD remains bullish

From Investing.com: 2025-01-28 02:11:00

Gold prices dropped by 1.09% as investors closed positions amid a wider market downturn fueled by concerns over DeepSeek, a Chinese AI startup. The global equity sell-off pushed US Treasury yields to a three-week low. Despite this, XAU/USD remains bullish, with a 45% chance of a 25 bps rate cut by the Fed. Focus today on US macro reports for price movements.

The euro rallied against the USD but retraced later, influenced by DeepSeek’s AI model challenging US tech dominance. The recent EUR/USD rally seems more due to USD weakness than euro strength. Market expects ECB to be more dovish than the Fed. Look out for US macro reports impacting EUR/USD today.

The Australian dollar fell by 0.29% against the USD amid risk aversion from a US equity sell-off. Trump’s tariff threats could negatively impact Australia’s economy as a major exporter of goods like iron ore and steel. AUD/USD remains bearish, with doubts on RBA’s rate outlook. Watch US reports today and Aussie inflation report tomorrow for price movements in AUD/USD.



Read more at Investing.com: Gold Prices Tumble as Markets React to DeepSeek AI Disruption