Gold (XAU/USD) prices built on intraday gains above the $2,900 level, hitting fresh intraday highs during the first half of the European session and reversing most of the previous day’s losses to one-week lows. Investors remain concerned about the potential economic impact of US President Donald Trump’s trade tariffs and ongoing geopolitical risks. This continues to fuel global risk aversion and helps revive safe-haven demand for bullion.
Meanwhile, expectations that a tariff-led slowdown in the US could force the Federal Reserve (Fed) to cut interest rates several times this year kept US Treasury yields under pressure. This, in turn, dragged the US Dollar (USD) back closer to multi-month lows and became another factor that benefited non-yielding Gold prices. However, traders might refrain from placing fresh bullish bets around XAU/USD ahead of this week’s US inflation data.