Gold prices rise as investors 'value-buying' after US-China tariff truce

Pound, gold and oil prices in focus: commodity and currency check, 13 May

Updated Tue, May 13, 2025, 2:56 AM 4 min read

Gold (GC=F)

Gold prices recovered some ground on Tuesday morning, after having fallen following news of a tariff truce between the US and China, reducing the precious metal's appeal as a safe-haven asset.

Gold futures (GC=F) jumped 1% to $3,261.40 per ounce on Tuesday morning, while the spot gold price climbed 0.6% to $3,255.44 per ounce at the time of writing.

Prices for the precious metal slumped on Monday, after it was announced that the US and China had agreed to temporarily cut tariffs on each other's imports, marking a de-escalation in recent trade tensions.

US Treasury secretary Scott Bessent told reporters that the two countries had agreed to lower their tariffs by 115% for 90 days, following negotiations in Switzerland over the weekend.

Investors had been flocking to gold amid concerns over US president Donald Trump's tariff agenda, as it is considered to act a stable store of value, acting as a hedge in times of economic and political uncertainty.

An easing of trade tensions on Monday, therefore, dented the precious metal's appeal, as investors pivoted back to stock markets.

According to a Reuters report, KCM Trade chief market analyst Tim Waterer said there had been "some value-buying happening on gold at current levels which is helping to prop up the price, despite the generally better outlook for global growth with the US and China on better terms".

"The consolidation move in the dollar has allowed the gold price to make a mild push higher," he said.

Pound (GBPUSD=X, GBPEUR=X)

The pound rose against the dollar (GBPUSD=X) on Tuesday, up 0.3% to $1.3208, supported by weakness in the greenback.

The US dollar index, (DX-Y.NYB), which measures the greenback against a basket of six currencies, dipped 0.3% to 101.53 at the time of writing, as optimism over the US-China tariff deal appeared to wane slightly.

Meanwhile, data released by the Office for National Statistics (ONS) on Tuesday, showed that UK pay growth slowed in the three months to March.

The rate of unemployment also inched higher in that period, while the number of job vacancies fell in the three months to April and early estimates showed that the number of payrolled employees fell last month. This all signalled that the UK jobs market had started to cool.

Neil Wilson, UK investor strategist at Saxo Bank, said that "UK employment data shows cracks emerging, which supports a more dovish bias from the Bank of England (BoE)".

He added that the "BoE should not be hanging about and get in there with cuts, the inflation is not the problem now".

Meanwhile, data from the British Retail Consortium, also published on Tuesday, showed a 7% increase year-on-year in UK retail sales. That was up from a 4% decline recorded in April 2024 and was above average three-month growth of 2.9% and a 12-month average of 1.4%.

Derren Nathan, head of equity research at Hargreaves Lansdown, said: "This was boosted both by the favourable timing of Easter and the sunniest April on record. A more meaningful comparison looked at March and April combined.

"Here the trend still moved in the right direction but to the much smaller tune of 0.2% which is unlikely to offset the impact of higher wages and employers’ National Insurance contributions on profits."

In other currency moves, the pound rose against the euro (GBPEUR=X), up 0.2% to trade at €1.1887 at the time of writing.

Oil (BZ=F, CL=F)

Oil prices were little changed on Tuesday morning, as investors weighed the latest developments around global trade.

Brent crude futures (BZ=F) traded at $64.93 a barrel, while West Texas Intermediate futures (CL=F) dipped 0.2% to $61.80 a barrel.

Read more: Stocks that are trending today

Nathan said: "Tariff optimism hasn’t been enough to maintain the upward trajectory of Brent crude oil prices."

"The loosening supply environment is keeping a lid on momentum, with OPEC+ signalling increased output in May and June and traders evaluating the prospect of lighter sanctions on Iran and Russia."

More broadly, the FTSE 100 (^FTSE) was muted on Tuesday morning, trading at 8,605 points at the time of writing. For more details, check our live coverage here.

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