Gold drops 2% as Turkey-led Russia-Ukraine peace talks resume

Gold prices drop 2% as Russia-Ukraine peace talks resume, while US Dollar faces market pressure

Gold (XAU/USD) fell 2% on Friday, trading near $3,178 amid renewed peace talks between Russia and Ukraine hosted by Turkey. The drop comes despite lingering geopolitical tensions and ongoing global uncertainty. Ukrainian President Volodymyr Zelenskyy met with Turkish President Recep Tayyip Erdoğan in Ankara, signaling a possible shift in diplomacy, although Russian President Vladimir Putin did not attend, sending only lower-level diplomats.

Criticism of Russia by several world leaders followed, with threats of intensified sanctions aimed at urging Putin back to the negotiation table. The announcement that both delegations will reconvene in Istanbul triggered further bearish sentiment in gold markets.

At the same time, the US Dollar faced pressure from investors amid growing concerns about volatility in US assets. According to UBS's Mark Haefele, rising global uncertainty is leading investors to diversify away from the US Dollar, which typically supports gold. However, current optimism over peace developments seems to be outweighing safe-haven demand for gold, at least in the short term