Gold Prices Today, November 4: Continue to Plunge Amid China’s Tax Policy Shift and Eased U.S.-China Trade Tensions
Gold prices continued to tumble on November 4 as China scrapped tax incentives for gold sellers and U.S.-China trade tensions eased.
According to Kitco News, analysts at UBS believe that the current pullback in the gold market is only temporary and that the metal remains on track to reach 4,200 USD/ounce, with a potential upside scenario toward 4,700 USD/ounce driven by geopolitical risks or market uncertainty.
“The long-awaited correction has paused. Aside from technical factors, we don’t see any fundamental reason for this sell-off,” UBS analysts said.
The Swiss banking giant noted that the recent weakening in bullish momentum triggered a second drop in open futures contracts, but emphasized that underlying demand remains strong.
UBS analysts also cited the World Gold Council’s Q3 2025 Gold Demand Trends report, which confirmed “very strong and accelerating demand” from both central banks and retail investors.
Central banks have purchased 634 tons of gold so far this year — slower than last year’s pace but accelerating in Q4 — consistent with UBS’s forecast of 900–950 tons for 2025. ETF inflows reached 222 tons, and bar and coin demand exceeded 300 tons for the fourth consecutive quarter, showing that investor demand continues to rise.
“Jewelry demand is also not as weak as feared. We prefer to buy gold on dips and still believe investors are underallocated to the metal. We recommend a single-digit percentage gold allocation in investment portfolios,” UBS stated.
Earlier, on October 20, Sagar Khandelwal, strategist at UBS Global Wealth Management, said that lower real interest rates, a weaker U.S. dollar, rising government debt, and geopolitical uncertainty could push gold prices to 4,700 USD/ounce by Q1 2026.
“While the scale and speed of gold’s rally may increase volatility from here, we continue to see gold as a valuable component of a sustainable investment strategy. We believe this will further erode the U.S. dollar’s appeal and drive more capital into bullion,” Khandelwal noted.
Gold Prices Continue to Weaken
As of 6 a.m. (Vietnam time) on November 4, international gold prices traded around 4,005 USD/ounce, down 20 USD from the overnight peak of 4,025 USD/ounce. This marks a significant drop within just a few hours, reflecting rapid corrections by speculators after recent volatile sessions.
Last night, the market was rattled by China’s announcement to remove long-standing tax incentives on gold. Under the new rule, retailers will no longer be allowed to deduct value-added tax (VAT) when selling gold.
This move aims to boost fiscal revenue amid China’s economic pressures but is expected to raise the cost of gold purchases for domestic consumers in the world’s largest gold market.
As a result, physical gold demand in China may decline, indirectly putting downward pressure on global prices.
At the same time, the easing of U.S.-China trade tensions has weakened gold’s safe-haven appeal, while a stronger U.S. dollar has made gold more expensive for holders of other currencies. Consequently, investor demand has slowed, adding further downward pressure on today’s gold prices.
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