Gold rose on Tuesday, after breaking through the $5,100 mark for the first time in the previous session, as geopolitical uncertainty underpinned safe-haven demand, while silver also hovered near all-time highs.
Spot gold climbed 0.9 per cent to $5,060.36 per ounce, as of 05:07 GMT, after scaling a record $5,110.50 on Monday.
US gold futures for February delivery eased 0.5pc to $5,056.90 per ounce.
“Trump’s disruptive policy approach this year is playing into the hands of precious metals as a defensive play. The threats of higher tariffs to Canada and South Korea are doing enough to keep gold a safe-haven choice,” said Tim Waterer, KCM Trade’s chief market analyst.
Escalating trade tensions, US President Donald Trump said on Monday he would raise tariffs on South Korean auto, lumber, and pharmaceutical imports to 25pc, while criticising Seoul for failing to enact a trade deal with Washington.
This was after he threatened tariffs on Canada in the backdrop of a thawing relationship between the two countries, following Canadian Prime Minister Mark Carney’s visit to China earlier this month.
China’s Zijin Gold will buy Canada’s Allied Gold for about $4.02 billion in cash, amid record-high prices for gold. Gold’s unprecedented rally has boosted miners’ margins and cash flows, fuelling consolidation.
“The intervention from US and Japanese officials to steady the yen has dented the dollar and has been a boon for the gold price,” KCM’s Waterer added.
A looming US government shutdown and Trump’s erratic policymaking also pressured the greenback, making the dollar-priced gold cheaper for overseas consumers.
Bets are for the Federal Reserve to hold interest rates steady at its meeting beginning later in the day, amid a Trump administration’s criminal investigation of the central bank chief Jerome Powell, an evolving effort to fire Fed Governor Lisa Cook, and the upcoming nomination of a successor to Powell in May.
Spot silver jumped 4pc to $108.05 an ounce, after hitting a record high of $117.69 on Monday. The white metal has already surged 53pc so far this year.
Spot platinum tumbled 4pc to $2,647.39 per ounce after hitting a record $2,918.80 in the previous session, while palladium fell 1.4pc to $1,953.69.
