Traders Trim Gold Bets as Kremlin Hints at De-escalation in Ukraine

Gold climbed to its highest level in over two weeks as trade tensions and expectations of interest rate cuts boosted safe-haven demand. President Trump’s new tariffs took effect, sparking global trade friction, while U.S. jobless claims rose to a one-month high—fueling speculation that the Federal Reserve will cut rates soon. Analysts say that if economic data continues to weaken, gold could see even stronger support. With uncertainty rising and rate cuts likely, gold’s role as a safe-haven asset is once again in focus.

Gold prices remain near recent highs despite a slight dip, as investors grow concerned about the U.S. economy slipping into stagflation—a troubling mix of stagnant growth and rising inflation. A disappointing jobs report and weakening service-sector data have increased expectations that the Federal Reserve may soon cut interest rates. With real yields falling and economic uncertainty rising, gold’s appeal as a safe-haven and inflation hedge continues to grow. For now, the outlook for gold remains bullish, especially if the Fed shifts to a more dovish stance.

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According to the World Gold Council, central banks added a net 22 tonnes of gold to their reserves in June, with Uzbekistan breaking a four-month selling streak by purchasing 9 tonnes. In Q2, global central bank gold buying totaled 166 tonnes, with Poland leading the way by adding 19 tonnes. However, Q2 purchases were down 33% from Q1 levels, reflecting a slight cooling of demand as gold prices have surged nearly 30% this year. Still, ING analysts expect continued buying ahead, driven by geopolitical uncertainty and the desire to reduce reliance on the U.S. dollar.