XAU/USD edges up amid hopes for eased US-China tensions and potential Middle East de-escalation, though rate cut bets fade.
Gold prices (XAU/USD) climbed to around $4,660 in early Asian trading Friday, recovering some losses as investors weighed US-China summit developments. The meeting between Presidents Trump and Xi has raised hopes for improved bilateral relations, including discussions on tariffs and AI, while Xi’s remarks on deeper US business engagement in China added support.
Recent US inflation data, with PPI and CPI rising at multi-year highs, has dampened expectations for Federal Reserve rate cuts. This has capped gold’s upside, though geopolitical risks, including the Strait of Hormuz situation, remain in focus.
Traders are assessing the likelihood of a Middle East de-escalation, which could weaken the dollar and reduce aggressive central bank tightening, providing a tailwind for gold.