- US 10-year bond yields hit over two-week peak
- Trump unveils 25% tariffs on Japan, South Korea
- US Fed minutes due on Wednesday
July 8 (Reuters) - Gold prices eased on Tuesday, weighed by higher U.S. Treasury yields as U.S. President Donald Trump announced new tariff proposals on trading partners, including Japan and South Korea.
Spot gold was down 0.2% at $3,328.67 per ounce, as of 1207 GMT. U.S. gold futures fell 0.1% to $3,338.20.
The yield on benchmark U.S. 10-year notes rose to a two-week peak, making the non-yielding bullion less attractive.
"Gold is stuck between a rock and a hard place," said UBS commodity analyst Giovanni Staunovo.
"Negative for the gold price is the U.S. decision to extend the deadline for a trade deal for many trade partners, positive for the gold price is the fact that key U.S. trading partners in Asia might have to deal with higher tariffs in the near future, weighing on economic growth prospects."
On Monday, Trump told 14 countries that sharply higher tariffs would start on August 1, marking a new phase in the trade war he launched in April, with levies between 25% and 40%.
The new deadline was firm, Trump said, adding that he would consider extensions if countries made proposals for a trade deal.
"Reciprocal tariffs" were to be capped at 10% until July 9 to allow for negotiations, but so far, agreements have been reached only with Britain and Vietnam. In June, Washington and Beijing agreed on a framework covering tariff rates.
Meanwhile, China has warned the Trump administration against reigniting trade tensions and threatened to retaliate against nations that strike deals with the U.S. to exclude it from their supply chains.
Trump's tariffs have stoked inflation fears, further complicating the U.S. Federal Reserve's path to lower interest rates.
Investors await minutes of the Fed's June meeting, due on Wednesday, for more clues into the bank's policy outlook.
Spot silver fell 0.1% to $36.71 per ounce, platinum rose 0.2% to $1,372.51, and palladium rose 0.6% to $1,117.33.
Reporting by Brijesh Patel and Anmol Choubey in Bengaluru, additional reporting by Ishaan Arora; Editing by Tasim Zahid
Source: Reuters