Gold inches up on weaker dollar despite fading geopolitical risks 

SINGAPORE: Gold prices inched higher on Monday after earlier hitting a more than one-month low, supported by a weaker US dollar.

However, demand for the metal remained under pressure as easing trade tensions and geopolitical risks reduced investor appetite for safe-haven assets.

As of 0216 GMT, spot gold rose 0.3 per cent to $3,281.65 per ounce after falling to its lowest level since May 29 earlier in the session.

Tim Waterer, Chief Market Analyst at KCM Trade, said: “With some relief around tariff discussions and events in the Middle East, gold is taking a back seat as investors turn to risk assets.”

Asian stock markets strengthened, and Wall Street futures rose, while the US dollar index slipped 0.2 per cent. A weaker dollar typically makes gold more attractive for holders of other currencies.

The slight rebound in gold came as the US and China reportedly resolved disputes related to the supply of rare earth minerals and magnets. Treasury Secretary Scott Bessent noted on Friday that the Trump administration’s various trade agreements could be concluded by the September 1 Labour Day deadline. 

In contrast, tensions rose between the US and Canada, as President Donald Trump halted trade negotiations with Ottawa over a tax on US tech firms. He described the move as a “blatant attack” and threatened to impose new tariffs on Canadian goods within a week. 

Meanwhile, the ceasefire between Iran and Israel, following a 12-day conflict, continued to hold, further weighing on safe-haven demand. 

“The dollar remains under pressure, which is helping gold hold its ground. However, the $3,250 level is a key support. A break below that could push prices towards $3,200,” Waterer added. 

Gold typically loses appeal during periods of geopolitical calm and in high interest rate environments, as it does not yield interest. 

Among other precious metals, spot silver slipped 0.1 per cent to $36.02 per ounce, platinum gained 1 per cent to $1,353.13, and palladium rose 0.2 per cent to $1,135.48. 

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