Gold dips but still marks weekly profits

Gold prices fell on Thursday as the dollar stabilized against most major rivals, with the precious metal still marking weekly gains. 

US President Donald Trump ordered a full tariff review of US critical minerals imports in another escalation in his trade war with global trade partners.

Otherwise, Fed Chair Jerome Powell said that tariffs and the ongoing trade war between the US and the world, especially China, could weaken the Fed’s ability to contain inflation and boost US growth.

Powel expects inflation to rise and growth to slow down, but it’s still not clear which one of them needs more focus amid trade uncertainty. 

Powell said the Fed is assuming a wait and see stance until the dust clears before taking a monetary policy decision.

He also expects the economy  to move away from full employment and contained inflation targets due to the impact of tariffs.

In response, Trump criticized Powell and said his “termination couldn’t come soon enough”.

Separately, the European Central Bank cut interest rates by 25 basis points to 2.25% as expected by most analysts today.

It’s the seventh consecutive rate cut as the ECB attempts to boost the struggling eurozone economy amid a trade war with the US.

ECB President Christine Lagarde said that tariffs represent a shock, but their impact on inflation remains unclear.

Otherwise, the dollar index rose 0.1% as of 18:32 GMT to 99.4, with a session-high at 99.7, and a low at 99.2.

On trading, gold spot prices fell 0.4% as of 19:54 GMT to $3334.7 an ounce, while marking a weekly profit of 2.6%.