Gold Continues Sharp Decline Below $4,350 Amid Profit-Taking and Decreased Safe-Haven Demand

New York | EcoPulse24

Global gold prices continued their sharp decline during Monday trading, losing over 4% of their value and dropping below $4,350 per ounce. This marks the largest corrective movement in weeks, as investors took profits following a series of consecutive record highs for the precious metal.

The primary pressure on gold came from reduced safe-haven demand amidst early indications of progress in peace talks between the United States and Ukraine, which have somewhat eased the geopolitical risks that supported prices in recent months.

US President Donald Trump stated that ongoing negotiations with Ukrainian President Volodymyr Zelensky had made "significant progress," noting that reaching a final agreement could take several more weeks. Zelensky, in turn, said the general framework for an agreement is nearly complete, with key issues such as US security guarantees resolved, though core matters - especially the future of the Donbas region - remain under discussion.

Despite this sharp decline, structural support factors for gold remain intact. Persistent geopolitical tensions in the Middle East and escalating disputes between the US and Venezuela continue to enhance gold’s appeal as a hedge against risks and global uncertainty.

On a yearly basis, gold’s performance remains exceptionally strong, with prices up more than 70% since the start of the year - heading for the best annual gains since 1979, according to global market data. This exceptional performance reflects a mix of supportive factors, including continued central bank purchases, strong inflows into gold-backed ETFs, and growing expectations that the US Federal Reserve will cut interest rates in the coming year.

Analysts see the current movement as a natural technical correction after an extended rally, noting that the medium- and long-term outlook for gold remains supported by strong fundamentals, given a flexible monetary environment and unresolved geopolitical and economic risks.