Gold prices dropped on Wednesday in Asia as the U.S.’s decision to delay imposing tariffs on certain Chinese goods eased tension between the two sides and dented demand for the safe-haven metal.
Gold futures for December delivery traded on the Comex division of the New York Mercantile Exchange fell 0.4% to $1,507.95.
The United States Trade Representative announced overnight that certain products including clothing and cellphones have been removed from the tariff list based on “health, safety, national security and other factors” and will not face additional tariffs of 10%.
Other tariffs will be delayed to Dec. 15 from Sep. 1 for certain goods, it said.
The decision led to widespread hope that the trade war between the two countries was on the mend, sending equities higher but dented demand for the safe-haven gold.
Prior to the news, gold prices hit six-year highs on Hong Kong’s political chaos that saw its airport disrupted for the second day amid ongoing protests.
Carrie Lam said earlier this week that further violence involving protests could push the territory “down a path of no return”.
Overnight, U.S. President Donald Trump tweeted that the Chinese government is moving troops to the border with Hong Kong. Analysts warned that the situation could escalate quickly if Beijing decides to act with military force.
