Gold prices experienced a significant decline during Asian trading on Friday, falling due to a combination of profit-taking and strengthened dollar driven by speculations surrounding a potential Donald Trump presidency and stricter U.S. trade policies.
Spot gold dropped by 0.9%, settling at $2,423.89 per ounce, while August gold futures fell by 1.2% to $2,426.45 per ounce as of 01:05 ET (05:05 GMT). Gold prices are now approximately $50 below the record high reached earlier this week, reflecting a retreat after a strong rally over the past seven days.
Gold’s initial surge was fueled by optimism over potential interest rate cuts by the Federal Reserve, with market expectations indicating a more than 90% probability of a 25-basis point rate reduction in September, according to CME Fedwatch. However, this optimism was tempered by recent strong jobless claims data, which suggested resilience in the labor market—an important factor for the Fed in its rate-cutting decision.
Additionally, speculation about a second term for Donald Trump, following a surge in his popularity after a failed assassination attempt, boosted the dollar. Investors anticipated that Trump’s protectionist trade policies could attract more capital into the U.S.
Other precious metals followed gold’s downward trend on Friday. Platinum futures fell by 0.5% to $976.60 per ounce, and silver futures slid 1.6% to $29.762 per ounce, marking a two-week low.
