Gold holds steady as markets eye US-China trade talks

By Anmol Choubey

June 10 (Reuters) - Gold prices were steady on Tuesday as market participants awaited developments from the second day of U.S.-China trade talks in London, while a stronger dollar limited potential gains.

Spot gold XAU= held its ground at $3,330.46 an ounce, as of 0648 GMT. U.S. gold futures GCcv1 were also flat at $3,350.30.

The dollar index .DXY strengthened 0.2% against its rivals, making gold less affordable for other currency holders. USD/

The trade talks between the world's two largest economies encompass issues ranging from tariffs to restrictions on rare-earth metals.

"With U.S.-China trade talks still in the works, gold is trading reservedly until we see any progress is made between the two global superpowers," said Tim Waterer, chief market analyst at KCM Trade.

U.S. President Donald Trump said his administration was "doing well" in the negotiations.

Last month, both sides agreed to a temporary pause in tariffs against each other, offering some relief to financial markets.

Data from China showed export growth slowed to a three-month low in May as U.S. tariffs affected shipments, while factory-gate deflation worsened to its deepest level in two years.

Meanwhile, U.S. inflation data, due on Wednesday, could give investors more guidance on the U.S. Federal Reserve's monetary policy path.

"If CPI has ticked marginally higher, that would be an expected result, but if it jumps, then that could raise some alarm bells for investors, and any resulting flight to safety could help the gold price," Waterer said.

Gold typically gains appeal during periods of geopolitical and economic uncertainty, and it tends to perform well in low-interest-rate environments.

Elsewhere, spot silver XAG= was down 0.5% at $36.55 per ounce, platinum XPT= eased 0.4% to $1,211.90, while palladium XPD= slipped 0.8% to $1,066.28.