Gold fell for a third day on signs of potential trade-talk progress between the US and several other nations, quelling demand for havens even as signs of slowdowns have emerged in the largest economies.
Prices shed as much as 1.8% as investors weighed improving sentiment on Wall Street after Donald Trump's trade representative said he was nearing an announcement of a first tranche of deals. Adding to the optimism, China Central Television said the US had reached out to Beijing through various channels.
Bullion remains about a quarter higher this year after hitting a record above $3,500 last week before losing some ground. The ascent has been driven mainly by investors taking refuge in the haven asset as Trump's fast-evolving trade policy upended markets and stoked fears of a global slowdown. Speculative demand in China and central-bank buying has also supported gains.
Data on Wednesday showed the US economy contracted at the start of the year for the first time since 2022 due to a monumental pre-tariffs import surge. That saw traders boost bets on US monetary easing, with four quarter-point rate cuts priced in this year by the Federal Reserve to help prevent a recession. Lower rates are typically positive for bullion as it pays no interest.
Looking ahead, a key monthly US jobs report due Friday will shed more light on the initial effects from Trump's trade policies on the economy.
Spot gold was 1.7% lower at $3,231.84 an ounce at 11:23 a.m. in Singapore. The Bloomberg Dollar Spot Index edged higher. Silver fell by more than 1%, as platinum and palladium edged lower.
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