Will UAE gold prices rise or fall after US-China trade deal?
Gold to face short-term pressure as trade tensions ease and the US dollar remains strong
Dubai: Gold rose at the end of a volatile week as investors focused on the favourable outcome of upcoming trade talks between the world's two largest economies.
While the upswing may persist in the days ahead, what happens if a US-China trade deal is struck soon? Will gold prices fall afterward?
After notching a weekly gain of about 3%, bullion ended the week at $3,326.15 per ounce. In the UAE, a gram of 24K gold cost a tad over Dh400, while 22K was priced at Dh371.25. (Check live rates here.)
Trump talks tough, but shows optimism
US on Sunday announced a trade deal with China in Geneva, a statement by the White House said, with Secretary of the Treasury Scott Bessent adding that there was "substantial progress" between the parties.
US President Donald Trump floated an 80% tariff on China ahead of negotiations that began Saturday, urging Beijing to open its markets to more US goods. Yet his tone softened after the first day of talks in Geneva, calling discussions “a total reset negotiated in a friendly, but constructive, manner.” Chinese state media echoed the sentiment, describing the meeting as a step toward resolving tensions.
The US side reportedly aims to reduce tariffs below 60% in the first phase—targets they believe China might match. If progress is made, these cuts could take effect as early as next week.
Why gold could cool off if a deal is reached
The US-China trade conflict has been a major driver behind gold’s 27% rally this year, with prices peaking near $3,500 an ounce last month. A deal could weaken demand for gold as a safe haven. Compounding that, the US dollar is strengthening—Fed Chair Jerome Powell struck a cautious tone on future rate cuts, signaling the US won’t rush to ease policy.
A stronger dollar, which the UAE dirham is pegged to, makes gold more expensive for foreign buyers. If trade tensions ease and the dollar holds strong, gold prices could face downward pressure in the short term.
What UAE gold buyers should do now
For jewellery or coin shoppers, any global price dip could soon reflect in local UAE rates—a buying opportunity. For long-term investors, don’t be spooked by short-term swings. Gold typically performs well in periods of geopolitical or economic uncertainty.
