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Gold rises on renewed US-China trade tensions

  • Gold prices rose on Monday as the dollar eased amid renewed concerns over a trade war.
  • China imposed extra tariffs on U.S. products in response to U.S. duties on imports of aluminium and steel.
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Stockbyte

Gold prices rose on Monday as the dollar eased amid renewed concerns over a trade war after China imposed extra tariffs on U.S. products in response to U.S. duties on imports of aluminium and steel.

After falling in the past three trading sessions, spot gold jumped 1.12 percent to $1,338.81 per ounce at 12:31 p.m. EST. U.S. gold futures rose 1.17 percent to $1,342.80 an ounce.

China has slapped extra tariffs of up to 25 percent on 128 U.S. products including frozen pork, as well as wine and certain fruits and nuts, in response to U.S. duties on imports of aluminium and steel.

The tariffs take effect on Monday and match a list of potential tariffs on up to $3 billion in U.S. goods published by China on March 23.

"The trade war is going on and it is getting worse, so that might be the reason that people are selling dollar and buying gold," said Yuichi Ikemizu at ICBC Standard Bank in Tokyo.

Gold fell 1.7 percent last week in its biggest such drop since early December. But the precious metal climbed 1.7 percent in January-March, posting its third straight quarterly gain.

The dollar index, which measures the greenback against six other major currencies, eased 0.2 percent to 89.988.

Hedge funds and money managers increased their net long positions in COMEX gold contracts in the week to March 27, U.S. Commodity Futures Trading Commission data showed on Friday.

Gold speculators raised their net long position by 50,996 contracts to 172,834 contracts, CFTC data showed.

In other precious metals, spot silver climbed 1.61 percent to $16.58 per ounce.

Platinum rose 0.38 percent to $931.50 per ounce, having fallen to its lowest since end-December in the previous session.

Palladium was down 1.95 percent at $931.20 an ounce after falling to $938.22 on Thursday, its lowest level since Oct. 11.