By Joseph Dahrieh, Managing Principal, Tickmill
July 23, 2025:
Gold prices retreated slightly on Wednesday after touching multi-week highs, pressured by a wave of optimism following a new agreement between the United States and Japan. Despite the modest decline, the yellow metal remains supported by underlying geopolitical risks and persistent macro uncertainty.
The bilateral deal with Japan, which includes a 15% tariff and expanded market access for US goods, boosted investor sentiment and trimmed demand for safe-haven assets. Similar trade progress with Southeast Asian partners has further supported risk appetite, reducing the urgency for defensive positioning.
Nonetheless, broader negotiations remain unresolved, particularly with the European Union, which is preparing retaliatory measures should talks fail ahead of the August 1 deadline.
Markets also continue to assess the Federal Reserve’s next move. While rates are expected to remain unchanged at next week’s meeting, political pressure on Chair Jerome Powell persists, fueling some unease.
Geopolitical tensions remain elevated in Eastern Europe and the Middle East, which could boost safe havens assets demand.