Gold fell more than 3% yesterday to below $4,000/oz, as its correction from last week continued amid progress in US-China trade negotiations that reduced safe-haven demand, ING's FX analyst Chris Turner notes.

Gold drops over 3% below $4,000 on US-China trade optimism

"Just last Monday, gold hit a record high above $4,380/oz. A trade deal between the two countries could reduce some of the geopolitical tensions that have driven gold to multiple record highs this year. The slump in prices coincides with further outflows from gold-backed ETFs; last Friday saw the biggest outflow since May 2025."

"Even after today’s correction, gold is still up more than 50% this year, underpinned by strong ETF demand and central bank buying amid diversification. And central bank buying is likely to continue as the structural factors behind this year’s rally remain in place. The recent price pullback could even be seen by some central banks as a chance to increase their holdings."