Gold Drops to $3,300 as America-China Trade War Continues

Last week saw the price of gold slip below $3,300 to hit $3,294, representing a more than 1.6% loss. This comes as the trade war between America and China continues and volatility in the market triggers mixed sentiments between traders.

Earlier in the week, President Trump stated in an interview that they were holding tariff negotiations with China, revealing that President Xi Jinping had given him a call. He repeated these sentiments to reporters prior to his departure for Rome to attend the funeral of Pope Francis.

However, Beijing responded to these remarks in a statement by the Chinese Embassy in America, noting that China and America weren’t in any negotiations or consultations on tariffs. The foreign ministry’s statement added that America needed to stop fueling confusion.

Separately, President Jinping announced plans to counter the impact of this trade war, which involved ensuring emergency plans were in place and strengthening bottom-line thinking. Additionally, China plans to collaborate with the global community to withstand unilateral bullying practices and endorse multilateralism.

Chinese authorities also held meetings to consider exempting some American products from the 125% tariffs impose on all American imports, among those considered being semiconductors and medical equipment. This news saw stock markets across the Asia Pacific region rise.

In other news, U.S. treasury yields continue to fall, with figures showing that real yields dropped to 1.96%.

Data from the University of Michigan shows that consumer sentiment in the U.S. has also taken a hit, with April being its 4^th lowest reading in decades. The institution’s report determined that consumer sentiment for the month hit 52, with one-year expectations of inflation increasing to 6.5% and 5-year expectations rising to 4.4%.

Now traders look forward to the release of this month’s nonfarm payroll figures, the ISM Manufacturing PMI, the 1^st reading of Q1 GDP and the March edition of the JOLTS report.

Most traders also expect the U.S. Federal Reserve to maintain the current rates of interest in its upcoming meeting. This comes after Beth Hammack, President of the Cleveland Federal Reserve, stated that the Federal Reserve may act soon if there was data to support it.

Overall, buyers’ momentum for gold seems to be declining, given the lack of commitment to push the price of gold over $3,400. Despite this, the precious metal continues to push forward, same goes for copper which saw its price rise by 2.1%. Nickel also recorded 1.9% in gains.

For as long geopolitical and trade tensions persist, gold is bound to retain its appeal to investors looking to shield their portfolios from this turmoil. Consequently, the outlook for gold companies like Torr Metals Inc. (TSX.V: TMET) remains positive in the immediate to mid-term.

NOTE TO INVESTORS: The latest news and updates relating to Torr Metals Inc. (TSX.V: TMET) are available in the company’s newsroom at https://ibn.fm/TMET

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