Gold has suffered its worst period in six months

Gold suffered its worst loss in six months last week as U.S.-China trade tensions eased, falling to $3,200 an ounce.

Commodity markets ended the week on a mixed note, driven by monetary policy uncertainties and a strengthening dollar index, despite the optimism created by the US and China's decision to reduce customs duties for 90 days.

US Federal Reserve (Fed) Chairman Jerome Powell reiterated his warning that 'more frequent and persistent supply shocks' could be seen, saying the economic environment has changed significantly since 2020 and that the review of the bank's monetary policy strategy will reflect its assessment of these changes.

In money market pricing, the expectation that the Fed will continue to monitor tariff-related price pressures despite the slowdown in annual inflation has strengthened. In money markets, the expectation for the first interest rate cut has been postponed to September, while a total of two cuts are anticipated during the year.

With these developments, the US 10-year bond yield closed the week with a 5 basis point increase to 4.44 percent, while the dollar index rose 0.8 percent to 101.1. Precious metals lost value due to the decrease in safe haven demand due to the increase in global risk appetite and the effect of the strengthening dollar index.

The ounce price of gold fell to $3,200, its worst weekly performance since November 11, 2024, due to the weakening safe haven demand and the rising dollar index due to the easing of US-China trade tensions.

Analysts stated that gold, which does not earn interest, generally gains value in low interest environments, and that pricing in money markets, as well as the strengthening of the dollar and the temporary trade agreement between the US and China, put pressure on gold prices.

As a result of these developments, all precious metals lost value. On an ounce basis, prices fell by 2.7 percent for gold, 0.8 percent for platinum, 1.6 percent for palladium and 1.4 percent for silver.