WASHINGTON (dpa-AFX) - Gold extended a blistering rally on Tuesday, surging nearly 2 percent to break above $3,500 per pounce earlier before giving up some initial gains.
Spot gold was up 0.7 percent at $3,449.07 per ounce in early European trade after a 2.9 percent jump on Monday.
U.S. gold futures were up 1.2 percent at $3,465.89 on haven demand as the dollar remained under pressure after hitting a three-year low on Monday.
The dollar index headed for a fourth day of losses as tariff negotiations showed little progress and fears of a U.S. recession mounted.
U.S. President Donald Trump's latest criticism of Federal Reserve Chair Jerome Powell drove up uncertainty and fueled volatility in financial markets.
In a post on Truth Social, Trump claimed without evidence that 'pre-emptive cuts' were being called for 'by many' now that the economy was facing what he described as 'virtually No Inflation.'
Intensifying his attacks on Powell, Trump warned there can be a slowing of the economy unless 'Mr. Too Late, a major loser, lowers interest rates, NOW.'
Trump's warning to trade partners against what he calls 'non-tariff cheating' and China's retaliation threat against countries that follow U.S. calls to isolate Beijing also added to investor woes.
In economic releases, U.S. flash consumer confidence data for April and U.S. Richmond Fed manufacturing index for April are slated for release in the New York session.
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