Gold prices rise after 2 days of slipping as the China trade agreement is about to be signed

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<pre><pre>Gold prices rise after 2 days of slipping as the China trade agreement is about to be signed

Gold prices picked up again early Wednesday as investors took a cautious stance ahead of the expected signing of a US-China partial agreement later in the White House meeting.

Uncertainty that the so-called phase 1 trade pact will ease tensions between Beijing and Washington has kept the bar prices high, commodity strategists say. The longstanding trade dispute has fueled market uncertainty and has been blamed for the slowdown in global economic growth and the tailwind for the gold price.

However, some skepticism about a permanent solution between China and the United States has underpinned recent gains for the yellow metal. Chinese and U.S. delegates are expected to sign a Phase 1 trade pact at the White House at 11:30 a.m. Eastern Time.

"The US-China deal is more cautious," wrote ActivTrades chief analyst Carlo Alberto De Casa in a Wednesday report. "Phase 1 will be signed in the next few hours, but investors have expected more from this part of the agreement," he wrote.

Indeed, equity markets, which have risen in recent weeks in the US-China progress news, have been under pressure overnight, fearing that the next stage of negotiations will be challenging.

Gold for February delivery

GCG20, + 0.25%

Comex was up $ 7.40, or 0.5%, at $ 1,552 an ounce after declining two consecutive sessions.

March silver

SIH20, + 0.16%

rose 9 cents, or 0.5%, to $ 17.835 an ounce after losing 1.4% on Tuesday.

A contribution to supporting precious metal prices is questionable to what extent the deal can lead to real relaxation in later phases between the global superpowers. According to the Wall Street Journal, the first phase of the trade agreement will include the purchase of approximately $ 200 billion in US goods and services over the next two years. However, tariffs on Chinese goods valued at around $ 360 billion a year remain. According to reports by Bloomberg News, this development on Tuesday led to the markets cheaper price gains and negative results.

"Gold prices have traced overbought levels and are now more stable around the mid-15th century. Investors were keen to find out more about the expected tariff declines," wrote Han Tan, FXTM market analyst, in a daily research note.

US Treasury Secretary Steven Mnuchin said in an interview on CNBC on Wednesday morning that additional tariff reductions for Chinese goods are expected in the second phase of the trade talks, but without further explanation.