Gold prices rose on Monday, helped by a weaker dollar, while a delay in finding peace in Ukraine and concerns over the US tariff policy fuelled safe-haven demand for the metal. Spot gold climbed 0.3% to $2,866.76 an ounce by 0303 GMT.
US gold futures rose 1.1% to $2,880.50.
The dollar index fell 0.4% from a more than two-week high hit in the previous session, making bullion less expensive for other currency holders.
“Today’s early Asian bullish tone in gold is likely to be driven by geopolitical risk factors due to the pushback of the anticipated peace deal between Ukraine and Russia,” said Kelvin Wong, senior market analyst, Asia Pacific, at OANDA.
Ukrainian President Volodymyr Zelenskiy’s meeting with US President Donald Trump ended in disaster on Friday, adding uncertainty to financial markets already jittery due to weakening economic data and volatility around US trade policies.
US Commerce Secretary Howard Lutnick said on Sunday that tariffs on Canada and Mexico would come into effect on Tuesday, but Trump would determine whether to stick with the planned 25% level.
Trump said he would add another 10% tariff on Chinese goods on Tuesday, effectively doubling 10% duties imposed on February 4.
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Data released on Friday showed that US consumer spending unexpectedly fell in January, but a pickup in inflation could provide cover for the Federal Reserve to delay cutting interest rates for some time.
Although bullion is considered a hedge against geopolitical uncertainty, it loses its allure in a high interest rate environment. Among other metals, spot platinum shed 0.2% to $945.45 an ounce and palladium added 1% to $928.54.
Demand for industrial precious metals platinum and palladium will likely fall if tariffs proposed by the Trump administration on US auto imports dampen vehicle sales, analysts said. Spot silver was up 0.5% at $31.30.
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