Gold prices rebounded after steep weekly decline

Market comments on behalf of Li Xing Financial Markets Strategist Consultant to Exness

Gold prices rose on Monday, rebounding after a sharp weekly drop. Safe-haven demand returned amid growing concerns about the US economic outlook following a downgrade of the US government’s credit rating by Moody’s. The agency cited large fiscal deficits and rising debt costs, stripping the US of its last triple-A rating.

Meanwhile, risks around trade deals could continue to support gold’s appeal. While the recent US-China agreement temporarily lifted market sentiment by reducing tariffs, U.S. Treasury Secretary Scott Bessent warned that tariffs could return to higher “reciprocal” rates if countries fail to negotiate in “good faith”.

Geopolitical tensions add another layer of support. In Eastern Europe, Tensions continue to increase ahead of a scheduled call between US President Donald Trump and Russian President Vladimir Putin. In the Middle East, military operations in Gaza continue to escalate.

Looking ahead, investors will closely monitor US economic data and speeches from Federal Reserve officials for further insights into the central bank’s monetary policy path. Any signs of economic weakness or dovish comments could further support gold.

Zaid Barem / ymm