Gold bounces back from recent dip on uncertainty over global trade policy

Gold surged more than 1% on Thursday, driven by positive buying activity after a recent dip. On Wednesday, prices had fallen to a one-week low on optimism over a potential trade deal between the US and China.

Capital.com analyst Kyle Rodda noted that the current market volatility is being influenced by both technical fluctuations and fundamental risks, although the impact of underlying factors remains strong.

Support for gold was bolstered by comments from senior officials. US Treasury Secretary Scott Bessent stressed the importance of reducing excessive tariffs between America and China before entering into comprehensive negotiations. Meanwhile, President Donald Trump has indicated that he does not plan to cut duties unilaterally.

On top of that, the White House is reportedly considering easing tariff pressure on automakers in response to lobbying from the industry. 

Another reason for gold's rally is the recent depreciation of the dollar, which has lost some ground over the past two days. This downturn is happening in light of anticipated interest rate cuts by the Federal Reserve in June, enhancing investor appeal of safe-haven assets, as reported by Reuters.