Gold ticks higher with focus on US inflation data
Spot gold was up 0.1 per cent at US$3,346.94 per ounce, as of 0151 GMT. US gold futures were flat at US$3,355.60.
"Gold has shown in the past that it is an asset of choice when tariff tensions are ratcheted up, and the precious metal's move towards US$3,350 is evidence of this pattern playing out again," KCM Trade Chief Market Analyst Tim Waterer said.
"However, higher treasury yields and USD appreciation have created headwinds...For gold to make further progress towards US$3,400 a pullback in the USD or treasury yields may be required in the absence of heightened geopolitical events."
US President Donald Trump on Saturday threatened to impose a 30 per cent tariff on imports from Mexico and the European Union starting on August 1, after weeks of negotiations with the major US trading partners failed to reach a trade deal.
Traders' focus now shifts to US consumer price data for June, due at 1230 GMT on Tuesday.
Economists polled by Reuters expect headline inflation to increase to 2.7 per cent on an annual basis, up from 2.4 per cent in the prior month. Core inflation is expected to rise to 3.0 per cent, from 2.8 per cent.
Trump on Monday renewed his attacks on Fed Chair Jerome Powell, saying interest rates should be at 1 per cent or lower. Markets are pricing in 50 basis points of rate cuts by year-end, with the first reduction expected in September.
Gold, often considered as a safe-haven asset during times of economic uncertainties, tends to do well in a low-interest-rate environment.
Elsewhere, spot silver gained 0.3 per cent to US$38.24 per ounce, after hitting its highest level since September 2011 on Monday.
"Silver is benefitting from supply concerns and growing industrial demand. Also, gold's rise over the past 18 months has had investors looking elsewhere for value and silver has been one of the metals to rise as a result," Waterer said.
Platinum rose 0.3 per cent to US$1,368.30 and palladium edged 0.1 per cent higher to US$1,194.52.
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