Gold prices plunged 2% from a six-year high on Tuesday, after the United States announced it would postpone tariffs on some Chinese products and the two countries agreed to continue trade negotiations.
At 1800 GMT, spot gold fell 0.7% to $1,501.22 an ounce, earlier reaching its highest level since April 2013 of $1,534.31.
U.S. gold futures fell 0.2% to $1,514.1 an ounce.
The U.S. Trade Representative's Office (USTR) said Tuesday that the Trump administration will delay the imposition of a 10% tariff on some Chinese products, including laptops and mobile phones, until December 15. The U.S. government was scheduled to impose a 10% tariff on the remaining $300 billion of U.S. and Chinese imports from next month.
"Now relax or perhaps reconsider the new proposed tariff measures to cool the boom in [gold]," said Tai Wong, BMO's head of trading in basic metals and precious metal derivatives.
"Although this will not significantly reduce the overall positive outlook for gold, it will ease its momentum in the short term."
The news boosted the U.S. stock market from a decline to a rise and the dollar strengthened. The news that the United States and China agreed to hold another telephone conversation on trade within two weeks also brought further momentum.
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