WASHINGTON (dpa-AFX) - Gold prices nosedived on Monday amid dollar strength and signs of easing U.S.-China trade tensions.
Spot gold tumbled 1.8 percent to $4,037.07 an ounce in European trading, while U.S. gold futures were down 2.1 percent at $4,049.80.
Risk sentiment improved in financial markets after the U.S. and China hailed progress in trade talks in Malaysia.
Ahead of the first meeting between U.S. President Donald Trump and Xi Jinping since 2019 on the sidelines of the APEC summit in Gyeongju, South Korea, on Thursday, U.S. and Chinese officials on Sunday said they have negotiated a framework for a trade deal.
According to U.S. Treasury Secretary Scott Bessent, the outlines of the agreement include China easing rare earth export restrictions and buying 'significant' amounts of U.S. soybeans in exchange for Trump removing his threat of adding 100 percent tariffs on Chinese goods.
Meanwhile, Trump hiked tariffs on Canada by 10 percent and said he expects a Brazil trade deal 'pretty quickly' after meeting with Brazilian President Luiz Inacio Lula da Silva in Malaysia.
The Fed's monetary policy announcement will also remain in the spotlight this week, with the U.S. central bank widely expected to lower interest rates by another quarter point, bringing the benchmark rate to 3.75-4.00 percent.
The Fed meeting kicks off on Tuesday, October 28, and concludes on Wednesday, October 29, with the central bank's latest policy decision.
Fed chief Jerome Powell may leave the door open for another rate cut in December and could end quantitative tightening, the shrinking of the Fed's massive balance sheet.
The European Central Bank and the Bank of Japan will also announce their monetary policy decisions this week, with no change in policy rates expected.
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