Gold prices shine on safe-haven demand as traders try to gauge Trump’s policies on Investing.com

Investing.com – Gold prices edged higher in Asian trade on Tuesday as the dollar weakened sharply overnight, while traders tried to assess policy following the inauguration of US President Donald Trump.

It rose 0.3% to $2,727.39 an ounce, after the February end gained 0.4% to $2,743.57 an ounce at 01:28 ET (06:28 GMT).

Bullion rises due to the light of the ‘safe place’ in the uncertainty

Gold traders are clamoring for volatility as Trump begins his second term, with policy announcements expected to affect market volatility.

The precious metal, traditionally seen as a safe-haven asset, held prices above one-month highs.

Market sentiment is currently shaped by the interplay between US policy shifts and the Federal Reserve’s monetary stance.

Trump has vowed to impose new tariffs on his neighbors and China to lower its trade deficit. This could hurt gold prices by giving renewed strength to the dollar.

It fell more than 1 percent overnight but later rebounded in Asian hours, rising 0.3 percent.

A weak dollar typically pushes up gold prices because it makes the metal cheaper for buyers of other currencies.

Traders are closely watching Trump’s moves to assess their impact on gold’s direction.

Other precious metals were mixed on Tuesday. It was down 0.4% at $958.80 an ounce and rose 0.6% to $31.30 an ounce.

Copper remains under pressure as tariff concerns weigh in

Among industrial metals, copper prices fell as US tariffs, a stronger dollar and investor caution weighed on the red metal after Trump’s inauguration.

As of 2011 Copper prices fell sharply in mid-2018 and mid-2019 amid escalating tariff and trade tensions as investors expected a slowdown in demand from China, the world’s biggest copper consumer.

The benchmark on the London Metal Exchange was muted at $9,255.50 a tonne in February, down 0.6 percent to $4.2910 a pound.