Gold (GC=F)

Gold prices edged lower on Monday as a softening in tensions between the United States and China reduced demand for traditional safe-haven assets. A stronger dollar added further headwinds for the precious metal.

Gold futures were down by 0.2% to $3,292.00 per ounce at the time of writing, while the spot price slipped 0.8% to trade at $3,309.68 an ounce.

Investors have historically turned to gold during periods of geopolitical and economic uncertainty, as well as in low interest rate environments. But recent signs of improved dialogue between Washington and Beijing have tempered those concerns.

“Financial markets, and risk assets in particular, are feeling slightly better about the tariff picture compared to earlier this month,” Tim Waterer, chief Market Analyst at KCM Trade, told Reuters.

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"Comments last week from the White House have fuelled optimism that a US-China trade deal may eventuate, which has caused safe haven demand for assets such as gold to subside."

The firmer dollar also played a role in weakening bullion prices, as a stronger greenback makes gold more expensive for holders of other currencies.

Pound (GBPUSD=X, GBPEUR=X)

The pound was muted against the dollar in early European trading, just below the flatline at $1.3305, after posting losses in the previous session, as the greenback continues to recover.

The US Dollar Index (DX-Y.NYB), which measures the greenback against a basket of six major currencies, pushed higher, climbing 0.3% to $99.74

US Treasury secretary Scott Bessent said on Sunday he wasn’t sure if president Donald Trump had spoken directly with China's president Xi, casting more doubt on earlier optimism about tariff talks.

Despite the dollar’s recovery, analysts believe the US currency will correct further.

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“Our chief economist Jan Hatzius wrote about USD depreciation in the FT this morning. Jan outlined that the recent depreciation in the USD has considerably further to go given elevated valuation levels, the extensive amount ($22tn) of US assets held by non-US investors and their potential reluctance to add to portfolios going forward,” strategists at Goldman Sachs told clients last Thursday. “We think the dollar is overvalued,” they added.

Elsewhere in currency markets, the pound was also flat against the euro, just above the flatline at €1.1712.

Oil (BZ=F, CL=F)

Oil prices rose modestly on Monday, though gains were capped by persistent uncertainty surrounding US-China trade negotiations and growing expectations that OPEC+ may move to increase supply — both factors clouding the global demand outlook.