Gold consolidated gains from a day earlier, holding above $4,000 an ounce as traders weighed a US-China trade truce that failed to quash concerns about long-term competition between the world's two largest economies.

Bullion edged higher on Friday, after climbing 2.4% in the previous session to halt a four-day losing streak. While talks between Presidents Donald Trump and Xi Jinping appeared to resolve – for now – months of brinkmanship, a one-year pause is likely only to stabilize relations while buying each side time to reduce strategic dependence.

The détente also underscored the rise in China's economic clout since Trump's first term as US president, a shift that is fueling long-term unease and renewing interest in havens such as gold. Still, bullion is down more than 2% this week so far – on track for its second straight weekly loss. Expectations of fewer Federal Reserve rate cuts this year are weighing on the non-yielding metal, with treasuries extending declines after Fed Chair Jerome Powell's warning that investors should rein in hopes for a December reduction.

The precious metal has retreated sharply after a scorching rally that drove prices to a record above $4,380 an ounce on Oct. 20. Recent outflows from gold-backed exchange-traded funds have removed some of the support that underpinned the surge: Total gold ETF holdings fell for a sixth consecutive day on Wednesday, the longest streak of declines since April, according to data compiled by Bloomberg.

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Despite its recent pullback, gold has advanced more than 50% this year, with support from a push by mainstream investors to safeguard their portfolios against risk as well as accelerated central-bank buying, the World Gold Council said in a report on Thursday. Central banks purchased 28% more gold in the third quarter than during the preceding three months, reversing a downward trend seen earlier this year.

Spot gold rose 0.4% to $4,041.42 an ounce at 7:57 a.m. in Singapore. The Bloomberg Dollar Spot Index dipped 0.1%, after climbing 0.4% in the previous session. Silver was also up 0.4%, building on a three-day run of gains, while platinum and palladium rose.

Source: Bloomberg