Gold held declines after Federal Reserve Chair Jerome Powell said the US central bank isn’t in a rush to adjust interest rates despite President Donald Trump’s trade war.
“If the large increases in tariffs that have been announced are sustained, they’re likely to generate a rise in inflation, a slowdown in economic growth and an increase in unemployment,” Powell said.
The dollar pushed higher after Powell’s comments, keeping the downward pressure on bullion, which is priced in the greenback. Powell’s downplay of rate cuts is negative for gold as it typically benefits in a lower-rate environment.
Bullion earlier tumbled by as much as 2.1% after China and the US confirmed upcoming trade talks, easing demand for safe havens.
Spot gold fell 1.7% to $3,373.04 an ounce as of 3:28 p.m. in New York. The Bloomberg Dollar Spot Index was up 0.5%. Silver, platinum and palladium all slipped.
