US-Mexican tariffs are lifted, Fed rate cuts put the spotlight on the forefront

Gold retreated after the 14-month peak reached Monday after an agreement reached late last week between the United States and Mexico to avoid a tariff war slowing demand for safe havens for metal.

Spot gold had dropped 0.5% to $ 1,333.44 an ounce at 10:03 GMT.

In the previous session, the metal had reached its highest level since April 19, 2018 at $ 1,348.08 an ounce.

The US gold futures were down 0.5% to 1339.90 dollars an ounce.

The United States and Mexico reached an agreement Friday to avoid a tariff war. Mexico has agreed to rapidly expand a controversial asylum program and deploy security forces to stem the flow of illegal migrants from Central America.

The President of the United States, Donald Trump, defended the agreement with Mexico against criticism that there would be no major new commitment to stem the flow of Central American migrants entering the United States, and announced Sunday that more details will be published soon.

US equity futures surged, pulling optimism from the deal, while being backed by bets on a reduction in the US interest rate after Friday's pay data.

The US dollar also advanced 0.2% against the safe-haven Yen, following pressure for most of last week due to higher bets on US interest rate cuts. .

SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings fell by 0.15 percent to 756.42 tons on Friday from 757.59 tons on Thursday.

The value of China's gold reserves reached $ 79.83 billion in May, up from $ 78.35 billion at the end of April, data from the central bank revealed Monday.

Indian gold prices tumbled in last week's discounts, as rising local prices dampened demand, while premiums in other major Asian centers fell, as soaring prices spurred investors to resell ingots.

China is preparing to limit some technology exports to the United States, the editor-in-chief of China's Global Times newspaper said Saturday, underlining the hope of a settlement similar to that of Mexico in the context of 39, a trade war between the two countries.