Kuala Lumpur: Gold futures on Bursa Malaysia Derivatives closed marginally lower due to a shift in geopolitical sentiment, said SPI Asset Management managing partner Stephen Innes. He noted that markets are anticipating key diplomatic developments this week as the US pushes for a Russia-Ukraine ceasefire. This potential diplomatic breakthrough has prompted traders to unwind some risk hedges.

According to BERNAMA News Agency, this shift does not represent a structural change in the macroeconomic landscape. The ongoing trade war continues to pose a significant economic challenge, especially with the April 2 tariff deadline approaching. This situation has brought the growth outlook back into focus.

Innes explained that as tariffs increase, the economic impact could deepen, raising the likelihood of the Federal Reserve considering monetary easing. He suggested that any short-term dips in gold prices might present buying opportunities. The prevailing strategy remains unchanged: escalating tariffs could lead to economic slowdown, prompting potential Federal Reserve rate cuts, which in turn could keep gold as an attractive option.

The spot-month March 2025 contract saw a decrease to US$2,992.80 per troy ounce from the previous US$2,999.60. Similarly, the April 2025 contract dipped to US$3,003.10 from US$3,009.90. Contracts for May 2025, June 2025, and August 2025 all dropped to US$3,013.10 per troy ounce from US$3,019.90 per troy ounce last Friday.

The trading volume showed a decline, sliding to 26 lots from 419 lots, while open interest shrank to 75 contracts from 454 contracts. According to the London Bullion Market Association’s afternoon fix on March 14, the price of physical gold stood at US$2,978.05 per troy ounce.