At 11:43 GMT, XAUUSD is trading $3357.45, up $67.75 or +2.06%.

Ongoing U.S.-China Trade Strain Fuels Gold Bid

Gold’s strength was underpinned by renewed trade hostilities between the U.S. and China. President Trump announced plans to double tariffs on steel and aluminum imports to 50%, reigniting fears of a trade war after Beijing hit back at allegations of violating mineral export agreements.

With both sides accusing each other of breaching the Geneva trade accord, market participants are bracing for prolonged trade disruptions. The uncertainty has put upward pressure on gold and downward pressure on the U.S. dollar, which dropped 0.6% against a basket of currencies.

Geopolitical Risks in Europe Add to Safe-Haven Flows

Tensions between Russia and Ukraine also contributed to gold’s appeal. Intensified military actions from both sides—just before scheduled peace talks in Istanbul—have amplified risk-off sentiment. The flight to safety has pushed gold above a one-week high, as investors look to hedge against broader geopolitical fallout.

Bond markets also reflected the unease, with the U.S. 10-year yield ticking up to 4.434%, while the 30-year yield rose more than 3 basis points to 4.967%, highlighting inflation and policy uncertainty.

Dollar Weakness and Policy Risk Support Bullion

Beyond trade and war concerns, the dollar’s recent softness has reinforced gold’s upside. The greenback has surrendered gains from the previous week, weighed down by tariff-related stagflation fears and concerns over the U.S. fiscal outlook.