Gold climbed to its highest in nearly three-weeks on Tuesday, as calls for impeachment proceedings against U.S. President Donald Trump pushed stocks into red, with bullion getting a further boost from disappointing consumer confidence data.
"There are concerns around impeachment that may have helped unnerve markets a little bit. We saw the U.S. equity markets being pulled to and fro with the ongoing trade tensions," said Suki Cooper, precious metals analyst at Standard Chartered Bank.
The S&P 500 and the Nasdaq were set for their worst drops in one month on Tuesday after U.S. Representative John Lewis, one of the most senior leaders, joined other Democratic lawmakers in calling for impeachment proceedings to begin against President Donald Trump.
"Over the course of trading today we have seen a combination of concerns around the negative headline, political uncertainty weighing on the stock market and in turn treasury yields come off a little bit, and gold prices being boosted as safe haven asset," Cooper added.
A weak U.S. consumer confidence data ratcheted up concerns about the global economy, by falling by the most in nine months in September, as the country's economic outlooks darkened in the face of the U.S.-China trade war.
Trump delivered a stinging rebuke to China's trade practices at the United Nations General Assembly, saying he would not accept a "bad deal" in the ongoing trade negotiations.
Concerns over the global economy have continued to mount of late, with a survey out of the euro zone on Monday showing business growth stalled this month while mixed economic readings out the United States added to caution over the prolonged U.S.-China trade war.
"Fears of recession are growing in the Eurozone because the weakness in industry now also appears to be spilling over into the services sector," Commerzbank analysts wrote in a note.
"Gold was therefore in considerable demand as a safe haven yesterday, as reflected in high ETF (exchange-traded fund) inflows."
Holdings of SPDR Gold Trust GLD, the world's largest gold-backed ETF, jumped 1.6% to 908.52 tonnes on Monday, the highest since November 2016.
Among other precious metals, palladium jumped 1.2% to $1,673.05 an ounce after touching a record $1,675.50 an ounce.
Silver fell 0.8% to $18.49, having touched its highest since Sept. 6 at $18.74 earlier in the session, while platinum eased 0.4% to $952.91.