WASHINGTON (dpa-AFX) - Gold prices traded higher on Monday amidst trade tensions and expectations of Federal Reserve interest-rate cuts this year.
Spot gold edged up by 0.3 percent to $3,365.55 per ounce in European trade, with potential gains capped by resilience in the dollar. U.S. gold futures for August delivery were up 0.4 percent at $3,377.06.
U.S. President Donald Trump escalated his trade offensive, leading to increased volatility in global markets and prompting investors to seek refuge in bullion.
Trump on Saturday threatened to impose a 30 percent tariff on imports from Mexico and the European Union starting on Aug 1, even as they are locked in long negotiations.
Caution over the Russia-Ukraine conflict also aided gold, after Trump said Sunday the U.S. would provide Kyiv with more Patriot surface-to-air systems to help defend against Russia's nightly bombardments.
With a ceasefire and an eventual peace deal thus failing to achieve a breakthrough, Trump is expected to make a 'major statement' on Russia later today.
Amid growing global uncertainty, analysts say that the yellow metal is poised to break out of its current consolidation phase and enter a fresh uptrend.
On the data front, U.S. inflation prints due this week may give investors a chance to gauge the impact of Trump's tariffs feeding through the prices.
The CPI print, due on Tuesday, is expected to show a 0.3 percent month-on-month gain, up from 0.1 percent in May.
White House economic adviser Kevin Hassett said on Sunday that the Fed 'has a lot to answer for' on renovation cost overruns at its Washington headquarters.
Trump said that it would be a great thing if Fed Chair Jerome Powell stepped down.
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