By Li Xing

Gold prices traded lower as investors took profits following a record high. The decline was further pressured by a slight uptick in U.S. Treasury yields. At the same time, traders are assessing tariff developments, with a potential delay in tariffs on Mexico and Canada easing economic concerns, which could weigh on gold prices.

However, President Donald Trump’s announcement of a 25% tariff on EU cars and goods has reignited global trade worries, although the lack of clarity surrounding the policy may limit its immediate market impact.

This week’s key economic data adds another layer of complexity to gold’s short-term outlook. Today’s GDP report and initial jobless claims could influence sentiment and expectations for U.S. monetary policy. On Friday, PCE inflation data will be closely watched, as persistent inflation may reinforce the Fed’s hawkish stance, putting further pressure on gold. Conversely, cooling price pressures could pave the way for Fed easing, boosting gold’s appeal.

Meanwhile, signs of weakening physical demand are adding to selling pressure. China’s gold imports via Hong Kong fell to a near three-year low in January, raising concerns about subdued demand and its potential impact on gold prices.

Xing is Financial Markets Strategist Consultant to Exness