Gold prices slip as Dollar firms and tariff threats weigh on market sentiment

Gold prices retreated in early Asian trading on Monday, beginning the week under pressure as the U.S. dollar held firm and investor optimism for imminent rate cuts faded in the wake of last week’s strong U.S. jobs data. At the same time, escalating rhetoric from President Donald Trump over tariff threats failed to ignite a meaningful safe-haven bid for the yellow metal.

Despite renewed trade concerns, markets remained somewhat composed after Trump pushed back the tariff implementation deadline to August 1 from the initially proposed July 9—providing more time for potential negotiations.

Gold under pressure despite geopolitical noise

Spot gold fell 0.7% to $3,312.12 per ounce, while gold futures for September delivery declined 0.8% to $3,320.67 per ounce as of 07:10 AM Riyadh time.

The lack of a safe-haven rally stems partly from the nature of Trump’s announcement. While he vowed to issue formal tariff letters to 12 nations on Monday and threatened additional 10% duties on BRICS-aligned countries—accusing them of being hostile to the U.S.—the extended deadline has delayed the perceived urgency of the threat, muting market reaction for now.

Dollar strength weighs as Fed cut bets unwind

Gold also suffered from a stronger dollar, which retained last week’s gains after the robust U.S. non-farm payrolls (NFP) report. The data showed the economy added 147,000 jobs in June, far exceeding forecasts of 110,000. The unemployment rate also fell unexpectedly to 4.1%.

These developments prompted traders to sharply revise down their expectations for near-term rate cuts. According to the CME FedWatch Tool, odds of a July rate cut have almost completely vanished, with markets now pricing in a higher probability of the Fed holding rates steady in September.

Stronger interest rates typically boost the dollar while reducing the appeal of non-yielding assets like gold and other metals.

Industrial metals follow Gold’s lead

Losses extended across the broader metals complex. Platinum futures fell nearly 2% to $1,381.00 per ounce after a strong June performance. Silver dipped 0.6% to $36.91 per ounce.

In base metals, benchmark copper futures on the London Metal Exchange dropped 0.6% to $9,807.10 per ton, while U.S. copper contracts slid 1% to $5.0130 per pound, reflecting concerns over slowing demand amid growing global trade tensions.

Outlook: Gold stuck in a wait-and-see mode

With gold struggling to hold above the $3,300 mark and investor sentiment tilted cautiously towards the dollar, the yellow metal may need a fresh catalyst to regain upside momentum. Markets are now closely watching upcoming developments related to the tariff announcements and Wednesday’s release of the Federal Reserve’s June meeting minutes, which could offer additional clues on the timing and extent of potential monetary easing.

For now, gold appears to be in a holding pattern—caught between easing hopes and stronger macroeconomic signals. A deeper pullback below $3,300 could expose the $3,248 support zone, while a rebound would require reclaiming the $3,350 barrier as a first step toward retesting recent highs.