Gold price is consolidating the rebound from three-week lows of $2,832 early Monday, bracing for an eventful week amid looming US tariffs and the Ukraine truce deal.
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Asian traders hit their desks with renewed optimism over a likely Ukraine ceasefire proposed by France and the United Kingdom (UK) that overshadows US President Donald Trump’s heated situation with Ukraine’s President Volodymyr Zelensky on Friday at the Oval Office.
On Sunday, European leaders agreed to draft a peace plan on the Ukraine conflict to present to Washington.
The Euro (EUR) rebounds firmly on Europe’s renewed efforts for peace in Ukraine, weighing heavily on the US Dollar (USD) while lifting the USD-denominated Gold price.
Additionally, the Greenback deals a blow as risk sentiment receives a fresh lift from stronger-than-expected February Manufacturing PMI data. China’s Caixin PMI rose to 50.8 in February, compared to January’s 50.1. The reading surpassed the market forecast of 50.3.
The USD also suffers amid an impressive crypto market rebound led by Bitcoin (BTC) after Trump directed the Presidential Working Group on Sunday to move forward on a Crypto Strategic Reserve that will include Bitcoin, Ethereum (ETH), XRP, Solana (SOL), and Cardano (ADA).
Broad US Dollar decline helps Gold price recover some ground after two back-to-back days of intense selling last week.
However, the upbeat market mood reduces demand for US government bonds, driving US Treasury bond yields higher while limiting the upside in the non-yielding Gold price.
Looking ahead, Gold price will continue drawing haven demand as US tariffs on Canada, Mexico and China are set to take effect on March 4. Trump’s tariffs could spur market volatility and potential trade retaliation.
Further, reports that Ukraine’s President Volodymyr Zelensky has rejected the calls for a Ukraine-Russia ceasefire could also remain in favor of Gold buyers.
In the meantime, the US ISM Manufacturing PMI and Fedspeak could offer some trading incentives in Gold price.
