Investing.com-- Gold prices extended sharp declines for the third consecutive session in Asian trading on Thursday, as bullion’s safe-haven appeal eroded amid hopes of trade deal talks between the U.S. and its key trading partners.
Investors also assessed data showing an unexpected contraction in the U.S. economy, while they cautiously awaited upcoming data releases, including the monthly jobs report.
As of 02:10 ET (06:10 GMT), Spot Gold dropped 1.5% to $3,240.30 per ounce, its lowest level since April 16.
Gold Futures expiring in June slumped 2.1% to $3,248.64 an ounce.
The yellow metal was set to decline for the third consecutive session, after recently scaling record highs last month due to increased global economic uncertainty.
Tariff negotiation hopes weigh on gold as safe-haven demand eases
The Trump administration has reached out to China to initiate trade talks, a Chinese state-affiliated media outlet reported Wednesday.
Sentiment had been improving on the hope that the worst of the tariffs announcements may be behind the market, helped by U.S. President Donald Trump signing two orders on Tuesday to ease the impact of auto tariffs.
President Trump also said on Wednesday that he has "potential" trade deals with India, South Korea, and Japan.
These developments eased fears around rising US-Sino trade tensions, putting downward pressure on gold’s safe-haven demand.
Among other precious metals, Silver Futures slipped 1.3% to $32.115 an ounce, while Platinum Futures slipped 0.7% to $963.65an ounce.
US economy contracts in Q1, payrolls data awaited
Data on Wednesday showed that the U.S. economy unexpectedly contracted in the first quarter, with gross domestic product contracting by 0.3% on an annualized basis.
The weak data supports a case for a rate cut by the Federal Reserve, but the central bank has signaled a wait-and-see stance amid tariff uncertainty.
The US Dollar Index edged 0.3% higher, making gold costlier for foreign buyers.
Investors now await the monthly U.S. non-farm payrolls report due on Friday.
Copper rises on easing US-Sino trade tensions
Copper prices rose on Thursday on optimism around easing trade tensions for China, the world’s largest importer of the red metal.
Most Asian markets, including China, were on holiday, leading to thin trading volumes.
Benchmark Copper Futures on the London Metal Exchange rose 0.5% to $9,165.05 a ton, while Copper Futures expiring in July gained 0.5% to $4.6365 a pound.