Gold rose in price due to demand for safe-haven assets: what is the reason

Gold prices rose on Monday, amid escalating Russian war in Ukraine and a new threat by US President Donald Trump to double tariffs on steel and aluminum imports, prompting investors to seek refuge in safe bullion, UNN reports citing Reuters.

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Spot gold rose 0.7% to $3311.33 per ounce at 04:16 GMT (07:16 Kyiv time). US gold futures rose 0.6% to $3335.40.

On Friday, Trump said he plans to raise tariffs on imported steel and aluminum from 25% to 50%, prompting the European Commission to warn that Europe is ready to retaliate.

"As trade and geopolitical concerns resurface, it is not surprising that gold is rising at the start of the week," said Tim Waterer, chief market analyst at KCM Trade.

"Ukraine and Russia have stepped up military action ahead of the second round of peace talks in Istanbul, with a wave of attacks that includes one of Ukraine's most daring strikes of the war and a night-time drone strike by Russia," the publication notes.

"Risk assets are lagging at the start of the week, while a falling dollar is also supporting gold," Waterer said.

The US dollar index fell 0.1%, making bullion less expensive for overseas buyers.

This week, markets are awaiting speeches from several US Federal Reserve officials for clues on the monetary policy outlook, with Fed Chairman Jerome Powell due to speak later in the day.

Gold, considered a safe-haven asset in times of geopolitical and economic uncertainty, tends to thrive in low interest rate environments.

Meanwhile, Trump and Chinese President Xi Jinping are expected to meet soon to resolve trade issues, including a dispute over critical minerals, according to US Treasury Secretary Scott Bessent on Sunday.

Trump said he is ready to go to China to meet with Xi17.05.25, 02:37 • 6785 views

Spot silver rose 0.3% to $33.08 per ounce, platinum fell 0.4% to $1051.63, and palladium fell 0.3% to $967.62.