Gold touches over one-week low after US court blocks Trump’s tariffs

Gold hit a more than one-week low on Thursday (May 29), as the US dollar rallied and risk sentiment improved after a US federal court blocked US President Donald Trump’s “Liberation Day” tariffs from going into effect.

Spot gold was down 0.5 per cent at US$3,262.99 an ounce, as at 0057 GMT, its lowest since May 20.

US gold futures dropped 1.1 per cent to US$3,259.50. A US trade court on Wednesday blocked Trump’s tariffs from going into effect, ruling that the president overstepped his authority by imposing across-the-board duties on imports from nations that sell more to the United States than they buy.

The White House quickly appealed the decision, and could take it all the way to the Supreme Court if needed, but in the meantime, it offered some hope that Trump might back away from the highest tariff levels he had threatened.

The US dollar index jumped 0.5 per cent to a more than one-week high, making greenback-priced gold more expensive for other currency holders, while US Treasury yields also rose.

Asian shares and Wall Street futures climbed in Asia on Thursday.

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US Federal Reserve officials at their May 6 to 7 meeting acknowledged possible “difficult tradeoffs” ahead, with rising inflation and unemployment, and warned about growing recession risks, according to meeting minutes on Wednesday.

Investors now await US GDP data later in the day, followed by Friday’s Personal Consumption Expenditures numbers and comments from US central bank officials for more cues on interest rates.

SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings rose 0.34 per cent to 925.61 metric tonnes on Wednesday from 922.46 tonnes on Tuesday.

Elsewhere, spot silver eased 0.2 per cent to US$32.93 an ounce, platinum was steady at US$1,074.90 and palladium edged 0.3 per cent higher to US$964.75. REUTERS