U.S. Dollar Slides Sharply, Boosting Gold Prices

Market Overview

In early Asian trading hours on Tuesday, April 29, spot gold remained rangebound, currently hovering around $3,333 per ounce. On Monday, gold prices reversed earlier losses, having dipped to near $3,268 before buyers stepped in at lower levels. A broad-based decline in the U.S. dollar also provided support for gold. Investors are exercising caution ahead of further developments on U.S. trade policy and are bracing for a packed week of economic data releases, which could offer early signals on whether President Trump's trade war is starting to take effect.

Hot Topics to Watch

● U.S. Treasury Sharply Revises Up Q2 Borrowing Estimate

On Monday, the U.S. Treasury Department announced a sharp upward revision to its second-quarter net borrowing estimate, now $391 billion higher than projected in February. The adjustment stems from Congress‘s failure to raise the federal debt ceiling thus far, leaving the Treasury’s initial cash balance at the start of the quarter significantly lower than expected. Excluding the cash balance factor, the revised borrowing estimate would actually be $53 billion lower than initially forecasted in February. Some analysts believe this reflects the impact of the Department of the Government Economy (DOGE) initiatives, which have improved fiscal conditions and reduced financing needs.

● Chinas Domestic Gold ETF Holdings Surge in Q1

In the first quarter, China increased its gold holdings by 12.75 metric tons, while domestic gold ETFs saw inflows of 23.47 metric tons—marking a 327.73% year-over-year increase compared to a 5.49-ton increase in Q1 2024. High gold prices dampened jewelry consumption, which fell 26.85% year-over-year. Meanwhile, heightened geopolitical risks and ongoing economic uncertainty have reinforced golds role as a safe-haven asset, driving a sharp rise in private sector demand for gold bars and coins.

Key Events to Watch

• 20:00 GMT+2 — U.S. Treasury Secretary Bessent to hold a press conference

• 21:00 GMT+2 — U.S. February FHFA House Price Index (MoM), U.S. February S&P/Case-Shiller 20-City Home Price Index (YoY)

• 22:00 GMT+2 — U.S. March JOLTs Job Openings (in thousands), U.S. April Conference Board Consumer Confidence Index