Gold gains on softer dollar, mounting Trump tariff concerns

3 Mar 202500:35 UTCRefinitiv

GOLD

DXY

PL1!

XPDUSD1!

Gold prices firmed on Monday, helped by a weaker U.S. dollar and rising fears that U.S. President Donald Trump's tariff threats could lead to a global trade war and stoke inflation, thereby fuelling safe-haven demand for the metal.

FUNDAMENTALS

* Spot gold GOLD was up 0.3% at $2,868.29 an ounce, as of 0010 GMT. U.S. gold futures GOLD rose 1.1% to $2,880.70.

* The dollar index DXY fell 0.3% from a two-week high hit in the previous session, making bullion less expensive for other currency holders.

* U.S. Commerce Secretary Howard Lutnick said on Sunday that tariffs on Canada and Mexico will go into effect on Tuesday, but Trump will determine whether to stick with the planned 25% level.

* Trump also said he would add another 10% tariff on Chinese goods on Tuesday, effectively doubling 10% duties imposed on February 4.

* On Friday, U.S. consumer spending unexpectedly fell in January, but a pick up in inflation could provide cover for the Federal Reserve to delay cutting interest rates for some time.

* Traders of futures contracts that settle to the Fed's policy rate maintained bets that the U.S. central bank will restart cuts to short-term borrowing rates in June after data showed inflation rose in line with expectations in January.

* In other metals, spot platinum PL1! gained 0.4% to $950.94 an ounce and palladium XPDUSD1! firmed 1.2% to $929.72.

* Demand for industrial precious metals platinum and palladium will likely fall if tariffs proposed by Trump on U.S. auto imports dampen vehicle sales, analysts said.

* Spot silver XAGUSD1! was up 0.1% at $31.18.