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On the downside, support is seen at $2,888.52, with stronger buying interest expected around $2,857.49 and $2,836.67. A move below $2,864.33 could shift short-term momentum downward, but a sustained sell-off appears unlikely given the underlying market support.
At 11:52 GMT, XAU/USD is trading $2900.39, up $17.91 or +0.62%.
Gold Benefits from Dollar Weakness and Tariff Uncertainty
A weaker U.S. dollar is providing a tailwind for gold, making the metal more attractive to international buyers. The dollar index remains under pressure, struggling to recover after last week’s 1.2% decline, driven by weaker-than-expected U.S. retail sales data.
Adding to market uncertainty, former President Donald Trump has renewed tariff threats, stating that auto levies could take effect as early as April 2. Concerns over potential retaliatory measures and escalating trade tensions have boosted safe-haven demand for gold. UBS analyst Giovanni Staunovo reaffirmed a bullish outlook, projecting prices to reach $3,000, supported by ongoing central bank demand.
Geopolitical Developments Could Influence Gold’s Momentum
Markets are closely watching U.S.-Russia negotiations as reports suggest Saudi Arabia may host peace talks regarding the Ukraine conflict. Progress in these discussions could cap some of gold’s gains, though underlying geopolitical risks remain a key driver for the metal. Exinity Group analyst Han Tan noted that while peace talks could slow gold’s rally, ample support remains to keep prices elevated.
Meanwhile, U.S. Federal Reserve officials are set to speak later in the day, with traders awaiting any insights on the future path of interest rates. The recent downturn in U.S. economic data has reignited expectations for potential Fed rate cuts, which would further support non-yielding assets like gold.
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