What a difference a week makes. About 7 days ago, rising tensions in Ukraine and secret meetings of the Federal Reserve caused a jump in gold prices to around $1,326 an ounce. This week, however, data showed that the U.S. economic outlook is a bit brighter, demand for gold in China has weakened, and nothing much has happened between Russia and its former republic. All of this has led gold prices to dip below $1,300 an ounce on Thursday.

The Wall Street Journal has reported that gold prices have been under pressure in recent days due to concerns over weaker demand from China, the world’s leading gold consumer. As the U.S. economy shows signs of recovery, China’s economy is showing signs of slowing. Since China’s appetite for gold and other precious metals is unmatched, the potential for any decrease in demand is a scary prospect for investors.

“The Chinese economy, if anything, is seeing contraction and as that happens, the consumer there has a bit less, not more, to spend, and that is bearish for the gold market,” Ira Epstein, director of the Ira Epstein division at the Linn Group, told The Wall Street Journal.

Earlier this week, a report was released showing that U.S. industrial production rose and retail sales strengthened last month. Any news of economic recovery tends to lead directly to a drop in gold prices, since gold is used primarily as a safe-haven investment.

Despite the negative news (relative to gold prices), the yellow metal remains up 8 percent on the year. This can most likely be attributed to rising global tensions, specifically the threat of war between Russia and Ukraine.

According to The Wall Street Journal, foreign ministers from Russia, Ukraine, the European Union, and the United States met on Thursday in Geneva to discuss how to deescalate the situation. According to the report, these are the highest-level talks between Russia and Ukraine since Moscow annexed the Crimea region and placed tens of thousands of troops on the border with Ukraine.

While this news does not necessarily bode well for gold prices in the short-term, nothing being reported is backed with a high level of confidence. The global economic and geopolitical situations are very fluid and sentiment could swing the other way at any moment.  Gold investors typically use this type of uncertainty as validation for owing the physical metal (coins & bars) in their portfolios as a safe-haven.