Gold Price Holds Near $3,325 as Markets Watch US-China Trade Talks

Gold Price Forecast: XAU/USD Rises to $3,325 as Market Eyes US-China Trade Outcome

Commodity Market Update – June 10, 2025

The Gold price (XAU/USD) posted modest gains during the early Asian trading session on Tuesday, reaching around $3,325. The advance is primarily driven by a weaker US Dollar (USD) and cautious optimism ahead of ongoing US-China trade talks in London.

Trade Talks Drive Sentiment for XAU/USD

Diplomatic discussions between the United States and China are underway for a second day. US President Donald Trump expressed confidence, stating that the negotiations "should go very well." American officials have hinted at a partial removal of export restrictions on tech goods if China reciprocates by loosening controls on rare earth exports, critical for sectors like energy, defense, and technology.

Related: Why Rare Earth Metals Matter in Global Trade

While a resolution to trade tensions could lift risk sentiment and strengthen the USD, analysts suggest the downside risk to gold is limited in the near term. According to Bart Melek, Head of Commodity Strategies at TD Securities, a positive outcome from the talks would be “marginally negative” for gold but not dramatically so.

China’s Central Bank Adds to Gold Reserves

Adding to gold's underlying support is news that China’s central bank increased its gold reserves for a seventh consecutive month in May. Persistent central bank demand often signals a long-term bullish trend for the metal, especially amid global economic uncertainty.

Further Reading: Central Banks and Their Role in Gold Prices

Gold Technical Outlook

Despite the modest gains, XAU/USD remains in a consolidation phase above $3,300. A breakout above key resistance at $3,340 could open the door to further upside. However, price action will likely remain subdued until the trade talks conclude or significant US macro data releases occur.

Conclusion

Gold prices are holding firm above $3,300 as markets navigate geopolitical developments and expectations around central bank activity. While a breakthrough in US-China trade relations may apply pressure to the metal, demand fundamentals—including central bank buying—provide a firm cushion for XAU/USD.