Investing.com - Gold prices remained supported on Monday, as fears of a potential trade war and political uncertainty in Europe boosted demand for safe-haven assets.
Comex gold futures were up 0.25% at $1,326.7 a troy ounce by 02:05 a.m. ET (06:05 GMT), the highest since February 27.
Risk sentiment waned after U.S. President Donald Trump announced plans on Thursday to impose tariffs of 25% on imported steel and 10% on aluminum, in a move to “protect U.S. industry”.
The move sparked concerns over a potential trade war, which would have a negative impact on the U.S. economy, sending the greenback broadly lower.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.12% at 90.06, after falling to 89.83 on Friday.
Gold is sensitive to moves in both U.S. rates and the dollar. A weaker dollar makes gold less expensive for holders of foreign currency, while a rise in U.S. rates lifts the opportunity cost of holding non-yielding assets such as bullion.
Markets were also jittery after Italian elections on Sunday ended in a hung parliament with none of the country's three main groups able to rule alone.
On a more positive note, Germany's Social Democratic Party (SPD) voted on Sundayfor a coalition deal with Chancelor Angela Merkel's conservatives, ending two months of political uncertainty. The new government could be in place in less than two weeks.
Elsewhere on the Comex, silver futures gained 0.57% to $16.58 a troy ounce.