- China loosens gold import quotas
- Gold reserves in London vaults rise in April
By Sarah Qureshi and Ashitha Shivaprasad
May 8 (Reuters) - Gold extended losses and fell more than 1% on Thursday after U.S. President Donald Trump announced a trade deal with the United Kingdom, raising hopes of such deals with other countries.
Spot gold XAU= slipped 1.7% to $3,307.84 an ounce as of 12:22 ET (18:22 GMT). U.S. gold futures GCcv1 settled 2.5% lower at $3,306.
Trump and British Prime Minister Keir Starmer announced a "breakthrough deal" on trade. A 10% tariff on goods imported from the UK remains in place while Britain agreed to lower its tariffs to 1.8% from 5.1% and provide greater access to U.S. goods.
"If we (also) get a deal ironed out between U.S. and China, there'll be a lot of resistance to the upside and gold should trade back down to, at the very least to $3,200," said Bob Haberkorn, senior market strategist at RJO Futures.
Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer are set to meet with China's top economic official on Saturday in Switzerland.
Bullion, widely regarded as a hedge against geopolitical uncertainty, had hit multiple record highs since Trump first announced his tariffs.
Elsewhere, China's central bank has approved foreign exchange purchases by commercial banks to pay for gold imports under recently increased quotas, two people with direct knowledge of the matter said.
"Theoretically, this move should boost gold prices as increased demand from China becomes a factor. However, current market dynamics are dominated by developments surrounding tariffs," said Zain Vawda, analyst at MarketPulse by OANDA.
Meanwhile, gold reserves in London vaults rose in April as more of the precious metal returned from New York after dislocation. Market players had increased gold deliveries to the U.S. in the December-March period to cover their COMEX positions against the possibility the U.S. would impose tariffs on imports.
Spot silver XAG= fell to $32.48, platinum XPT= gained 0.8% to $981.60 and palladium XPD= added 0.3% to $974.81.
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