On Monday (March 3) morning trading in the Asian market, spot gold opened high and rose, rising by about $17 to $2876.72 per ounce, recovering most of last Friday's losses. The argument between Ukrainian President Zelensky and US President Trump during their meeting dampened hopes of reaching a peace agreement soon to end the Russia Ukraine war; Market concerns over Trump's tariff threat have also attracted bargain hunters to support gold prices. On March 2nd local time, US Commerce Secretary Howard Lutnik announced that the United States will impose tariffs on Canada and Mexico on March 4th.

Last week, the price of hardware fell 0.62%, hitting a nearly one month low of $2832.58/ounce in the session. At that time, the market expected that the President of Ukraine would sign a mineral agreement with the United States on Friday, and the Russia-Ukraine conflict might be near the end; Moreover, the previous US inflation data met expectations, indicating that the Federal Reserve may take a cautious stance towards further interest rate cuts. Although the decline in gold prices narrowed at the end of last Friday, closing at $2859.02 per ounce, the weekly line still fell 2.63%, marking the first weekly decline since the beginning of the year and the largest weekly decline since November.

At present, the focus of the market is the further news of the situation in Russia and Ukraine. Investors also need to pay attention to the US February ISM manufacturing PMI data and the speech of Saint Louis Fed Chairman Musalem.

Consumer spending in the United States fell for the first time in nearly two years in January, and the trade deficit hit a new high

Consumer spending in the United States decreased for the first time in nearly two years in January, while the goods trade deficit widened to a historic high as companies imported goods ahead of schedule to avoid tariffs. These factors put the US economy at risk of slowing growth or even contraction in the first quarter of this year.

The data released by the Ministry of Commerce last Friday also showed that although the annual inflation rate in January has decreased, inflation still maintains a certain stickiness, and the month on month increase in prices is still significant. In addition, the Trump administration has further increased tariffs, which economists warn will lead to higher costs of imported goods and ultimately be passed on to consumers.

The Economic Analysis Bureau of the Ministry of Commerce reported that consumer spending decreased by 0.2% in January, marking the first decline since March 2023 and the largest decline in nearly four years. The growth rate of consumer spending in December has been revised upwards to 0.8%, compared to the previous value of 0.7%. Economists had previously predicted a 0.1% increase in consumer spending in January. In the past few months, consumers started to consume early due to concerns about the impact of tariffs, but this trend reversed in January, leading to a decline in spending.

The combination of inflation stickiness highlighted in this report and potential growth panic may pose worrying monetary policy challenges for the Federal Reserve, "said Olu Sonola, head of US economic research at Fitch Ratings

The US Department of Commerce's Bureau of Statistics reported that the goods trade deficit surged 25.6% to $153.3 billion in January, setting a record high.

Imports increased by 11.9%, mainly due to companies purchasing goods in advance to avoid the upcoming tariffs. Export growth of 2.0% is not enough to offset the impact of the surge in imports. The surge in imports further dragged down the economic growth prospects for the first quarter.

Despite the decline in consumption, the labor market remains robust, providing support for household income. Personal income increased by 0.9% and salary increased by 0.4% in January.

Due to faster income growth than consumer spending, the savings rate rose from 3.5% in December to 4.6%, the highest level in seven months.

The personal consumption expenditure (PCE) price index rose by 0.3% month on month in January, which was the same as the uncorrected increase in December and in line with economists' expectations. PCE increased by 2.5% year-on-year, slightly lower than the 2.6% in December.

Excluding food and energy, the core PCE increased by 0.3% month on month, with an uncorrected increase of 0.2% in December. A year-on-year increase of 2.6%, lower than the 2.9% increase in December.

Zelensky and Trump's White House meeting ends in argument, with no mineral agreement signed between the two sides

The meeting between Ukrainian President Zelensky and Trump on Friday ended in failure, and at the White House, the two leaders engaged in an unusually heated argument in front of global media regarding the Russia Ukraine conflict.

This White House meeting is a dream come true for Zelensky, who hopes it will help his country persuade the United States not to side with Russian President Putin.. However, Trump and Vice President Vance criticized him for not respecting the United States, highlighting a major setback for Kiev's efforts to maintain Western support after the new US administration took office.

Since taking office as president, Trump has consistently sided with Putin, which has shocked his traditional allies in Europe and other regions and made Ukraine increasingly vulnerable. Last Friday's argument was the most public manifestation of the US government's shift in stance so far.

Vance stressed the need to resolve the Russia-Ukraine conflict through diplomatic means, while Zerensky countered that Putin was not credible in any negotiations, and pointed out that Vance had never visited Ukraine. The Russo Ukrainian War is the largest conflict that has erupted in Europe since World War II.

Zelensky left the White House early last Friday without signing the highly anticipated agreement between Ukraine and the United States for joint development of natural resources.

This argument also undermines recent efforts by European leaders to persuade Trump to provide security guarantees for Ukraine, even if Trump refuses to deploy US troops on Ukrainian territory to maintain peace. Trump threatens to withdraw US support for Ukraine.

Jack McIntyre, portfolio manager at Brandywine Global, said, "A major driving force in the market now is uncertainty at many different levels, and this is another uncertainty

We seemed to be moving towards a peace agreement or ceasefire agreement between Russia and Ukraine before, but perhaps now all of this will be put on hold, so you must take more uncertainty into consideration“

The Anglo European Leaders' Summit supports Zelensky and will draft a peace plan to involve the United States

British Prime Minister Keir Starmer stated on Sunday (March 2) that European leaders have agreed to draft a peace plan for Ukraine and submit it to the United States, which is a crucial step for the United States to provide security guarantees to Ukraine. Kiev believes that US security guarantees are crucial for deterring Russia.

Just two days after Ukrainian President Zelensky had a dispute with US President Trump and interrupted his visit to Washington, world leaders expressed strong support to Zelensky at a summit in London and promised to take more measures to assist Ukraine.

European leaders unanimously believe that they must increase defense spending to show Trump that the European continent can protect itself. Von der Leyen, president of the European Union Executive Committee, suggested that the EU could relax the regulations on limiting the level of debt because many EU countries' public finances were already stretched.

Stamer welcomed Zelensky with a warm embrace on Saturday (March 1), stating that the UK, Ukraine, France, and other countries will form a coalition of the will and draft a peace plan to be submitted to Trump. Stamer stated that more countries are willing to join, but did not disclose which ones.

We are at a crossroads in history, "said Stamer." Now is not the time for empty talk, but for action. It is time to step forward, play a leadership role, unite for new plans, and achieve a just and lasting peace

Zelensky stated after the summit that Europe's unity has reached an unprecedented level in a long time.

Zelensky wrote on Telegram, "We Europeans are all working together to find a foundation for cooperation with the United States for true peace and guaranteed security

After the unsuccessful meeting between Trump and Zelensky in the Oval Office, Europe is working hard to ensure that Kiev is not excluded from any negotiations.

Several leaders have stated that they must increase defense spending - which will help bring Trump closer and provide security guarantees for the United States while achieving peace.

Von der Leyen told reporters: "After a long-term lack of investment, the most important thing now is to strengthen long-term investment in national defense."

Member states need more fiscal space to increase defense spending, "she said, adding that Europe needs to turn" Ukraine into a steel pig that potential invaders cannot digest.

Polish Prime Minister Tusk stated that the attending leaders unanimously agreed that Europe needs to take on more responsibilities and begin to bear the burden of "more defense budget expenditures within NATO". He added that the attending leaders unanimously agreed to maintain close contact with the United States.

Stamer stated that leaders of various countries also agreed on Sunday to work towards ensuring Kiev's participation in any peace negotiations and enhancing the country's own defense capabilities. He said at a press conference, "Europe must shoulder the heavy responsibility, but in order to support peace on our continent and achieve success, this effort must receive strong support from the United States