Quick overview

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The bullion asset traded in negative territory at about $3,285. XAU/USD declined in value as the US dollar rose following US President Donald Trump’s announcement of new tariff agreements with trading partners.

The White House said late Thursday that Trump would establish a base tariff rate of 10 percent, rejecting earlier claims that he might raise the floor to 15 percent or more. Furthermore, an executive order signed by Trump raises the tariff on Canada from 25% to 35%,  from August 1, 2025.

Trump gave trade talks more time by extending Mexico’s current tariff rates for another ninety days. Ahead of the release of the US employment data for July later on Friday, traders are still evaluating the developments surrounding US tariffs. In July, 110K new jobs are anticipated to be added to the US economy, and the unemployment rate is predicted to increase from 4.1 percent to 4.2 percent.

The US Federal Reserve’s (Fed) hawkish posture may have short-term effects on the non-yielding yellow metal. At its July meeting on Wednesday, the US central bank held rates unchanged. Fed Chair Jerome Powell stated that the Fed should wait for additional data before deciding on whether to raise rates in September.

Signs of heightened geopolitical or trade tensions usually boost safe-haven flows and mitigate losses in gold.