PRECIOUS-Gold falls as trade tensions soften, US data on tap

By Anjana Anil and Sarah Qureshi

April 29 (Reuters) - Gold fell nearly 1% on Tuesday as signals of easing U.S.-China trade tensions reduced some safe-haven demand, while investors braced for key economic data this week to gauge the Federal Reserve's policy outlook.

Spot gold XAU= was down 0.8% at $3,315.84 an ounce as of 2:22  pm ET (1822 GMT). U.S. gold futures GCcv1 settled 0.4% lower at $3,333.6.

"There is some optimism that there will be some de-escalation of the trade war between the U.S. and China," said David Meger, director of metals trading at High Ridge Futures.MKTS/GLOB

President Donald Trump's administration plans to lessen the effect of auto tariffs by lowering taxes on foreign parts used in U.S.-made cars and making sure imported cars are not hit with multiple tariffs, officials said.

Softening trade tensions has caused a sell-off in safe-haven gold, a traditional hedge against rising global instabilities, which had risen in an unprecedented rally to notch a record high at $3,500.05/oz last week.

U.S. Treasury Secretary Scott Bessent said on Monday several top trading partners had made "very good" proposals to avoid U.S. tariffs. China's recent moves to exempt certain U.S. goods from its retaliatory tariffs showed a willingness to de-escalate trade tensions, Bessent added.

Investors' radar is now on a slew of important U.S. economic data this week, including the personal consumption expenditures price index on Wednesday, and a monthly non-farm payrolls report on Friday.

"Looking at the key level in the near-term, $3,500 would be a fair level where you're going to see people stepping in and starting to liquidate which is normal ebb and flow of the market," said Michael Matousek, head trader at U.S. Global Investors.

"For quarter-end, we could probably see gold up at $3,590. For the year-end, I would put the forecast at $3,800 an ounce."

Spot silver XAG= shed 0.4% to $33.02 an ounce, platinum XPT= eased about 1% to $976.50 and palladium XPD= fell 1.3% to $936.41.