Gold demand soars on rising trade tensions

Gold prices climbed 0.5% on Tuesday, bouncing off a nearly four-week low hit in the previous session. Growing concerns over global tensions between the United States and its major trading allies have significantly increased investor demand for safe-haven assets.

President Donald Trump ratcheted up his rhetoric against China on Monday, threatening to impose new tariffs against the Asian country. Meanwhile, the European Union announced plans to retaliate, raising worries about the ongoing deterioration in trade relations, which could potentially lead to a global recession.

Gold is traditionally seen as a safe-haven asset in times of geopolitical and economic instability. On April 3, the metal rose to an all-time high of $3,167.59 per ounce.

Market participants are looking forward to the release of the Federal Reserve’s minutes from its latest meeting on Wednesday, followed by CPI data on Thursday. These reports are likely to provide further clarity on the future of interest rates in the US, Reuters reported.