Investing.com - Gold prices turned lower on Monday, pulling away from five-week highs after reports that the U.S. and China had started negotiations over escalating trade tensions eased fears over a possible all-out trade war.
Gold futures for April delivery on the Comex division of the New York Mercantile Exchange were down $4.5 or 0.33% to $1,345.4 a troy ounce by 04:19 AM ET (08:19 GMT).
Gold prices rose to a five-week high of $1350.40 on Friday as a weaker dollar and heightened trade tensions bolstered demand for the precious metal.
The Wall Street Journal reported Monday that Beijing and Washington were negotiating to improve U.S. access to Chinese markets, after a week of threats to use trade tariffs.
Recent worries that protectionist trade policies from the U.S. and China might result in a trade war have boosted gold, amid fears over the impact on global economic growth.
The report saw the safe haven yen come off 16-month highs against the dollar and U.S. stock futures rebound as investor sentiment recovered.
The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was down 0.15% to a near one-month low of 88.97.
Investors seek out gold as a store of value during times of geopolitical uncertainty or market turmoil, while a weaker dollar makes the dollar-denominated metal cheaper for holders of other currencies.
In other precious metal trade, silver futures were down 0.16% at $16.555 a troy ounce, while platinum futures were little changed for the day at $954.9.
Among base metals, copper futures were down 1.44 % to $2.950 a pound. Recent trade fears have pressured prices to their weakest levels since December after they hit a nearly four-year high late last year.