The metal reached its strongest in a week as appetite for nominally lower-risk assets sharpened. Palladium, which has also benefited from fears sanctions on Russia could hurt supply, rose further after climbing nearly 6 percent in the last two days.
Spot gold was up 0.5 percent at $1,345.80 an ounce by 0957 GMT, while US gold futures were 0.2 percent higher at $1,349.10 an ounce.
"We've seen fears of a trade war and now more recently the Russian sanctions," Capital Economics analyst Simona Gambarini said. "Uncertainty, volatility and geopolitical risk have been rising steadily since the start of the year."
That has sparked good demand for gold through products such as bullion-backed exchange-traded funds, she said. "Gold is benefiting from the risk-off sentiment, and because people are trying to hedge against worst-case scenarios."
European stocks fell after two days of gains as tensions over Syria and US sanctions drove Russia's rouble to a two-year low, while concerns about the prospect of a trade war boosted traditional safety plays at the expense of the dollar.
The US unit languished near a two-week low against a basket of currencies.
Gold is often perceived as a safe store of value during times of political and financial uncertainty.
Markets are also awaiting cues on the outlook for US monetary policy from consumer inflation data and minutes from the Federal Reserve's March meeting, due later on Wednesday.
Tighter monetary policy raises the opportunity cost of holding non-yielding bullion.