Investing.com - Gold prices rose to their highest level in around a year on Tuesday, as demand for safe-haven assets remained strong in the wake of North Korea's most powerful nuclear test to date.
Geopolitical risks tend to boost demand for safe havens such as gold, which is considered a good store of value during volatility in other markets.
Comex gold futures jumped $10.30, or around 0.8%, to $1,340.77 a troy ounce by 2:50AM ET (0650GMT), after touching its best level since September 27, 2016 at $1,345.50 earlier.
The yellow metal did not settle on Monday due to the U.S. Labor Day holiday.
Elsewhere on the Comex, silver futures tacked on 14.7 cents, or about 0.8%, to $17.96 a troy ounce. It rose to $18.03 earlier, the most since April 25.
North Korea conducted its sixth and most powerful nuclear test to date on Sunday, which it said was a successful detonation of an advanced hydrogen bomb.
Adding to concern on the Korean peninsula, South Korea’s Defense Ministry said Monday that Pyongyang is making preparations for the possible launch of another intercontinental ballistic missile. Many experts have been preparing for a weapons test around September 9, when North Korea marks the anniversary of its foundation in 1948.
In response, the U.S. told the United Nations on Monday that Pyongyang was "begging for war," before urging the 15-member Security Council to respond with the "strongest possible measures" against the isolated regime.
The escalating tensions prompted investors to dump assets seen as riskier, such as stocks and high yielding currencies, and flock to traditional safe-haven assets like the yen, sovereign bonds and bullion.
Among other precious metals, platinum added 0.3% to $1,012.20, while palladium held steady at $976.90 an ounce.
Meanwhile, copper futures rallied 5.6 cents, or roughly 1.8%, to a more than three-year high of $3.176 a pound, boosted by growing confidence in the global economy.