(MENAFN) Gold prices declined by approximately 3.2% on Monday, settling at $3,981, following indications of reduced trade friction between the United States and China, alongside the establishment of new trade agreements with several Asian nations.

Recent hints from US President Donald Trump about the potential easing of trade tensions with China have contributed to the downward trend in gold prices over the past few days.

The precious metal had reached an all-time peak of $4,381.6 last Monday, driven by ongoing trade disputes between the world’s two largest economies, expectations of interest rate reductions by the Federal Reserve, and central banks purchasing gold for their reserves.

However, after Trump mentioned the possibility of a "fair deal" with Beijing—following earlier threats to impose 100% tariffs due to China’s tighter control over rare earth exports—gold prices fell sharply.

Additionally, Trump’s three-country tour in Asia, which included the signing of new trade deals with Cambodia and Thailand, also pressured gold markets downward.

Furthermore, a scheduled meeting between US President Donald Trump and Chinese President Xi Jinping in South Korea on Thursday is expected to further ease tensions that have been particularly high over the last two weeks.

Silver also experienced a decline, with the price per ounce dropping 4.3% to $46.5 on Monday.

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