Gold reversed heavy early losses to hold steady on Thursday as a slight softening of the U.S. dollar prompted traders to cover their short positions.
Spot gold was up 0.32 percent at $1,178.50 an ounce after earlier falling more than 1 percent to hit its lowest level since January 2017. U.S. gold futures were marginally higher at $1,185.70 an ounce.
The dollar moved further away from a 13-month peak on improved risk appetite after China said it would hold a fresh round of talks with the United States later this month in an effort to diffuse tensions.
China’s Ministry of Commerce said that a Chinese delegation led by vice commerce minister Wang Shouwen will travel to the U.S. in late August for trade talks to be held with U.S. Under Secretary of Treasury for International Affairs David Malpass.
The last round of formal trade negotiations in June failed to make much progress, resulting in a trade war that’s hurting global growth.