BENGALURU: Gold prices rose on Monday as the dollar eased amid renewed concerns over a trade war after China imposed additional tariffs on US products in response to US duties on imports of aluminium and steel.
After falling in the past three trading sessions, spot gold edged up 0.5 percent to $1,331.19 per ounce at 0706 GMT.
China has slapped extra tariffs of up to 25 percent on 128 US products including frozen pork, as well as wine and certain fruits and nuts, in response to US 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 US 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.
The dollar index, which measures the greenback against six other major currencies, eased 0.3 percent to 89.929.
US gold futures rose 0.6 percent to $1,334.90 an ounce.
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 market is trading higher on bargain-hunting amid expectations that prices have hit bottom, said a Singapore-based trader.
“Even the most steel-nerved trader will be tempted to go in now,” he said.
Hedge funds and money managers increased their net long positions in COMEX gold contracts in the week to March 27, US 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 0.8 percent to $16.45 per ounce.