Investing.com – Gold prices were little changed on Wednesday in Asia, holding below the key $1,300 level, as global stocks recovered from a slump earlier this week triggered by escalating U.S.-China trade tensions.
Gold futures for June delivery, traded on the Comex division of the New York Mercantile Exchange, were at $1,295.95 per ounce by 12:30 AM ET (04:30 GMT).
The precious metal broke above $1,300 on Monday, hitting one-month highs, as risk-averse investors took to its safe-haven cover after China imposed higher duties on a range of U.S. goods
But U.S. President Donald Trump’s reassuring words on China on Tuesday revived expectations that a trade deal between Washington and Beijing was still possible, and that he looked forward to a “very fruitful meeting” at the G20 next month with his Chinese counterpart Xi Jinping.
His comments eased trade war tensions and sent global stocks higher. China’s Shanghai Composite and the Shenzhen Component both gained more than 1% on Wednesday, while other major indices in Asia also rose.
Overnight, Trump said in a tweet that China’s next move would likely be a rate cut, and he urged the Federal Reserve to do the same to help the U.S. to win the trade war.
“China will be pumping money into their system and probably reducing interest rates, as always, in order to make up for the business they are, and will be, losing. If the Federal Reserve ever did a “match,” it would be game over, we win! In any event, China wants a deal!” he tweeted.