Gold prices edged lower on Monday, as easing concerns over Federal Reserve policy and renewed optimism around U.S.-China trade talks strengthened the U.S. dollar and reduced demand for safe-haven assets. The pullback comes after a period of heightened volatility in global markets, where gold had benefited from investor caution.
Spot gold slipped to around $3,215 per ounce, retreating from recent highs after comments from former President Donald Trump signaled confidence in the Fed’s ability to manage inflation without over-tightening. His remarks helped calm fears of an overly aggressive monetary stance, which had previously supported gold as a hedge against rising rates.
XAU/USD 1-D Chart as of April 22nd, 2025 (Source: TradingView)
The metal also faced pressure from a stronger greenback, with the U.S. dollar climbing across major currencies following upbeat headlines around potential progress in U.S.-China trade negotiations. Traders responded positively to reports suggesting both sides are working toward a framework for renewed talks, boosting appetite for risk assets and weighing on non-yielding assets like gold.
Despite the day’s decline, analysts say the broader outlook for gold remains constructive, especially as long-term uncertainties around inflation, geopolitics, and monetary policy continue to linger. While optimism can temporarily lift equities and the dollar, many investors are still holding gold as a strategic hedge.
Technical support for gold sits near $3,200, with resistance seen around $3,250. A sustained break below support could trigger further selling, though dips are expected to attract buyers if macroeconomic risks persist or if market confidence in central banks begins to waver again.
For now, gold’s direction hinges on how much traction the dollar gains and whether trade optimism translates into real progress. Until there’s greater clarity, price action may remain choppy as investors balance short-term sentiment shifts with long-term defensive positioning.
