Gold prices took a breather on Wednesday, April 23, after soaring to record-breaking levels earlier in the week. A noticeable shift in investor sentiment followed US President Donald Trump’s softened stance on the Federal Reserve and growing optimism around a potential US-China trade agreement.

Gold Prices Slip Globally and in India

• Spot gold fell by 0.7% to $3,357.11 an ounce by 0256 GMT, while

• US gold futures declined by 1.5% to $3,366.80 an ounce.

• In India, according to Goodreturns, prices also dropped:

  • 24K gold: ₹10,136 per gram

  • 22K gold: ₹9,291 per gram

  • 18K gold: ₹7,602 per gram

This marks a sharp pullback after gold hit $3,500 an ounce on Tuesday (April 22)—its 28th record high of the year, driven by inflation fears, central bank buying, and global geopolitical risks.

Why Did Gold Prices Fall?

There are multiple reasons behind the sudden pullback in gold prices:

1. Trump’s Softer Tone on the Fed and China

President Donald Trump’s retreat from aggressive comments about firing Federal Reserve Chair Jerome Powell calmed markets. He also hinted at a possible trade deal with China that could significantly lower tariffs, lifting overall market sentiment.

These remarks boosted risk appetite, shifting funds away from safe-haven assets like gold.

“The change in tone triggered a sell-off. Gold hit oversold levels in the short term,” said Kelvin Wong, Senior Market Analyst at OANDA.

2. A Stronger Dollar and Rising US Stocks

A strong US dollar added to the downward pressure on gold. When the dollar strengthens, gold becomes more expensive for foreign buyers, reducing demand.

At the same time, US stock indices saw an uptick, further drawing investor interest away from gold.

3. Geopolitical Easing Signals

US Treasury Secretary Scott Bessent added to the optimism, saying he expects trade tensions with China to ease, though negotiations might still be slow.

In another significant development, Russian President Vladimir Putin gave subtle signals about the possibility of halting the Ukraine war. This reduced gold’s appeal as a geopolitical hedge.

Gold’s Meteoric Rise in 2025

Before the current dip, gold had been on a relentless upward trajectory this year. It breached new highs 28 times in 2025, climbing on:

• Global inflation worries

• Persistent geopolitical tensions

• Record levels of central bank gold buying

• Stock market uncertainty in developed economies

This led investors to flock to gold as a safe-haven asset, particularly amid turmoil in the Middle East, Europe, and volatile equity markets.

What Should Investors Do Now?

While the recent fall might concern some, experts caution against panic. The correction could be healthy, allowing long-term investors to re-enter at better levels.

Om Ghawalkar’s Investment Advice

Om Ghawalkar, Market Analyst at Share.Market, suggests the following:

“If gold forms over 25% of your portfolio, book some profits.”

He urges against investing lump sums at this stage, recommending SIPs (Systematic Investment Plans) in gold ETFs instead to navigate market volatility effectively.

Diversification is Key

According to Ghawalkar, diversifying across asset classes is crucial.

“Split your money across gold, equities, and debt. Don’t let market hype alter your strategy.”

He stresses on balancing gains and not over-exposing to any single asset, no matter how hot it seems.

Comparing Gold with Nifty 50

Interestingly, gold isn’t the only asset at highs. The Nifty 50 index has also touched new peaks, indicating a broader asset rally in India.

However, this also raises the stakes for correction, especially for investors who have heavily concentrated holdings in either gold or equities.

Final Word: Stay Rational and Structured

The gold market is dynamic, influenced by:

• Macroeconomic signals

• Global political news

• Currency movements

• Stock market behavior

While the pullback might seem sharp, it is part of the natural market cycle. Long-term fundamentals for gold remain strong, especially amid ongoing geopolitical risks and inflation fears.

Investors are advised to avoid emotional decisions. Stick to long-term plans, stay diversified, and use tools like gold ETFs and SIPs to maintain a balanced approach.

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