After finishing 1.4% higher the day before, bullion fell as much as 1% on Thursday.
Gold fell after hitting a new high of over $4,000 an ounce on Wednesday. This came after a wild rise that left the precious metal open to declines.
Gold Slips Amid Optimism
After finishing 1.4% higher the day before, bullion fell as much as 1% on Thursday. According to technical indicators, gold has been trading in overbought territory for the last month, which probably caused some investors to take profits.
When US President Donald Trump said that a peace agreement in the Middle East was “very near,” some of the attraction of gold as a sanctuary diminished. This was after officials from Israel and Hamas expressed cautious optimism that the two-year conflict in Gaza would end because of the ongoing peace negotiations in Egypt.
Metals Ease After Rally
Due to several concerns surrounding international commerce, the independence of the Federal Reserve, and the soundness of the US economy, gold has remained more than 50% higher this year. This year, central banks have continued to purchase bullion at a rapid pace, while increased geopolitical tensions have also increased demand for haven assets.
After hitting $4,059.31 on Wednesday, spot gold fell 0.3% to $4,031.21 an ounce as of 9:48 a.m. Singapore time. A 0.1% decline occurred in the Bloomberg Dollar Spot Index.
After making significant gains the day before, palladium remained stable on Thursday while platinum slightly declined. Inflows into exchange-traded funds (ETFs) backed by the metals and ongoing market tightness have supported prices. In Bloomberg intraday data dating back to 1993, silver fell but stayed at a record high.