Monday, May 12, 2025
The trade agreement between the United States and China, the value of the metal stood at US$ 3,242.
On Monday morning, the value of gold fell to its lowest level since May 2. The cause? The trade agreement between the United States and China reduced the demand for the metal, considered as a safe-haven asset, as investors took positions in other riskier instruments, such as stocks.
The price of gold fell 3% on the day to a price of US$ 3,242 an ounce, after the White House announced an agreement to reduce reciprocal tariffs with China.
“This relief is seen as potentially the beginning of the end of global trade war uncertainty,” said Aurica co-founder and director Josh Perez.
Although the price has shown a drop in value, “the medium to long-term view on gold remains positive. Major US banks have raised their target for gold, saying it will reach US$3,650-3,950 per ounce this year,” Perez said.
Likewise, the US bank, JPMorgan, said that gold could exceed US$ 4,000 in the second quarter of 2026.
Commodities on the rise
Unlike gold, the value of copper and oil rose on Monday after the announcement, in line with the good mood in the markets.
On Monday, the red metal traded on the London Metal Exchange at US$ 4.35 per pound, with a variation of 1.1%, according to Cochilco. This was its highest level since April 2.
Sonami's research manager, Reinaldo Salazar, said that “the advance responds to better expectations regarding demand, especially from China, although operators remain cautious about the possibility that the price may rise to US$ 4.35 per pound.
cautious about the possibility that trade tensions could be reactivated”.
However, copper futures fell 0.5% to US$ 4.62 per pound on the Comex market, which, according to Renta4, is mainly due to a multilateral strengthening of the dollar.
For its part, oil benefited from the agreement. During the day, both Brent oil futures, in the British market, and WTI, in the United States, rose by 1.7%. As a result, the Brent barrel traded at US$ 65.04, while WTI showed a similar behavior and traded at US$ 62.07.
Interview by Sofía Pumpin, Diario Financiero, with Josh Perez, Managing Director, Chief of Global Trading Aurica Canada.