Gold prices inch higher as a softer dollar and tariff concerns boost safe-haven demand

Gold prices gained momentum in Asian trading on Monday, supported by a softer dollar and renewed geopolitical concerns. Investors sought refuge in bullion amid uncertainty over U.S. trade tariffs and stalled Russia-Ukraine peace talks.

Spot Gold climbed 0.3% to $2,865.69 per ounce, while Gold Futures for April delivery advanced 0.9% to $2,873.59 an ounce as of 00:35 ET (05:35 GMT).

Weaker Dollar, Tariff Jitters Propel Gold Higher

The dollar dipped following fresh tariff-related uncertainty, giving gold an additional boost. Last week, U.S. President Donald Trump announced a 10% tariff increase on Chinese imports while reaffirming his timeline for 25% levies on Mexico and Canada.

However, on Sunday, U.S. Commerce Secretary Howard Lutnick stated that Trump will finalize the exact tariff levels on Tuesday, leaving markets on edge.

Adding to market unease, diplomatic tensions escalated after talks between Ukrainian President Volodymyr Zelenskyy and Trump collapsed, dimming hopes for a swift Russia-Ukraine peace resolution.

As a result, the U.S. Dollar Index fell 0.4% in Asian trading, pulling back from a two-week high. The weaker greenback, coupled with lingering geopolitical instability, reinforced gold’s status as a safe-haven asset.

Precious Metals Gain as Investors Seek Stability

Gold’s rally extended to other precious metals:

• Platinum Futures surged 1.2% to $949.10 per ounce.
• Silver Futures advanced 0.7% to $31.73 per ounce.

US Consumer Sentiment Wobbles, Inflation Stays Stubborn

Economic data released on Friday showed that U.S. consumer sentiment slipped 0.2% in January, marking its first decline in nearly two years. Meanwhile, the Atlanta Federal Reserve revised its Q1 2025 GDP growth forecast to 1.5%, down from 2.3% in the previous quarter.

While this fueled speculation about potential Federal Reserve rate cuts, inflation remains a sticking point. The PCE price index—the Fed’s preferred inflation gauge—rose 0.3% in January, matching December’s increase.

The data reinforced the Fed’s stance that interest rates may need to stay higher for longer, tempering expectations for aggressive monetary easing.

Copper Inches Up on Strong China Factory Data

Copper prices edged higher as the dollar weakened, with stronger-than-expected manufacturing activity in China adding to optimism.

China’s Caixin PMI hit a three-month high in February, signaling resilience in the world’s largest industrial metals consumer.

• Benchmark Copper Futures (London Metal Exchange): +0.3% to $9,985.70 per ton.
• April Copper Futures (Comex): slightly lower at $4.5595 per pound.

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