Gold Rebounds as Market Assesses US-China Talks and Fed Outlook

Gold prices advanced, snapping a four-day losing streak as traders analyzed the outcome of a high-stakes meeting between U.S. President Donald Trump and Chinese President Xi Jinping.

Bullion rose as much as 2.1% during the session, recovering from a sharp 5% decline over the previous four trading days. The metal’s rebound was sparked by details from the presidential meeting. President Trump described it as an “amazing meeting,” stating that China would halt its controls on rare earth minerals and resume buying American soybeans. Meanwhile, Chinese state media reported that President Xi is willing to cooperate with the U.S. on trade, energy, and AI.

The market is also grappling with mixed signals from the Federal Reserve. Last week, Fed Chair Jerome Powell downplayed the likelihood of a December rate cut after implementing an expected quarter-point reduction. However, that vote was marked by significant division, with three officials dissenting a run of dissents not seen since 2019.

Analysts suggest that despite the positive tone from the US-China talks, underlying uncertainty remains. "This looks like an early attempt to reset the US–China narrative," said Charu Chanana, chief investment strategist at Saxo Markets. "Gold is, however, still sniffing out uncertainty pricing a soft easing bias from the Fed and lingering geopolitical risk."

The precious metal’s recent volatility follows a scorching rally that pushed prices to a record high above $4,380 an ounce last week. That ascent was seen as "overheated" by technical indicators, and the recent progress in trade relations had eroded some of gold's safe-haven appeal, leading to the pullback.

Despite the correction, gold remains up approximately 50% this year. The bull market has been supported by significant central-bank buying and investor interest in the "debasement trade" a strategy to hedge against runaway budget deficits and currency devaluation.

"The market has experienced a natural correction, but we continue to view this bull market as incomparable," said Sebastian Mullins, head of multi-asset and fixed income at Schroders.

As of 11:32 a.m. in London, spot gold was trading 1% higher at $3,969.30 an ounce. Silver and palladium also advanced, while platinum was little changed.