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Gold Rises Amid Trade-War Risks While Traders Await Fed Decision

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(Bloomberg) -- Gold advanced amid ongoing trade war risks following US President Donald Trump’s latest tariff comments, while investors await a Federal Reserve interest-rate decision later this week.

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While Trump suggested his administration could strike trade deals with some countries as soon as this week, he signaled no imminent accord with China. Meanwhile, the Fed is widely expected to hold rates steady when policymakers conclude their meeting on Wednesday, despite Trump ratcheting up pressure on Chair Jerome Powell, saying last week’s surprisingly strong job data meant there was no reason not to cut rates. For Powell and his colleagues, a firm labor market can easily justify a decision to hold.

Gold has surged 26% this year, hitting a record above $3,500 an ounce in April before losing some ground in the last couple of weeks. The ascent has been driven by haven buying due to Trump’s highly disruptive trade and geopolitical policies, as well as speculative demand in China and global central-bank buying.

Spot gold rose 2.3% to $3,316.04 an ounce as of 10:21 a.m. in New York. The Bloomberg Dollar Spot Index was down 0.4%. Silver gained while platinum and palladium slipped.

In base metals markets, the London Metal Exchange is closed for a UK holiday. Copper prices on the Comex rose 0.4% to $4.691 a pound in New York.

--With assistance from Sybilla Gross and William Clowes.

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