U.S.-China Talks Yield Consensus, Market Sentiment Stabilizes

Market Overview

Last Friday, the U.S. dollar weakened as markets remained cautious ahead of high-level trade talks between the U.S. and China. The Dollar Index briefly dipped to 100.08 before closing 0.21% lower at 100.42. Geopolitical tensions between India and Pakistan fueled safe-haven demand, pushing spot gold to rebound after breaking below $3,280, ultimately settling 0.68% higher at $3,326.46 per ounce. Despite the Chinese delegation announcing meaningful progress in U.S.-China trade negotiations and former President Trump teasing one of his “most important and influential” announcements, spot gold opened $41 lower on Monday. Meanwhile, spot silver closed Friday up 0.98% at $32.72 per ounce.

Hot Topics to Watch

● India-Pakistan Ceasefire Remains Fragile

Despite both nations announcing a ceasefire, renewed explosions were reported in India-administered Kashmir. Reports claim that Pakistan's air defense systems downed an Indian drone near Peshawar airport, while India intercepted a Pakistani drone. India accused Pakistan of violating the ceasefire agreement, which Pakistan denied. The regional situation remains highly uncertain.

Key Events to Watch

• 22:25 GMT+8 – Fed Governor Kugler to speak

• 23:30 GMT+8 – U.S. 3-Month Treasury Bill Auction Results (Stop-out Yield and Allotment Percentage)