Gold prices experienced a significant surge on Monday, driven by escalating trade tensions between the United States and China, coupled with growing uncertainty surrounding tariffs. Investors flocked to the safe-haven asset as geopolitical risks intensified.

Spot gold climbed 0.7% to $3,311.33 per ounce, while U.S. gold futures advanced by 0.6% to $3,335.40. The rally was sparked by President Donald Trump’s unexpected move to double tariffs on imported steel and aluminum—from 25% to 50%—escalating fears of a broader trade confrontation. The European Commission responded with strong warnings, suggesting that retaliatory measures may be imminent, further unsettling already jittery markets.

Analysts point to heightened geopolitical and trade-related uncertainties as key drivers behind the surge in gold prices. The recent decline in the U.S. dollar has further boosted gold’s appeal among international investors by lowering its relative cost. Meanwhile, market participants are closely watching for statements from Federal Reserve officials this week, hoping to glean clues about the central bank’s next steps on interest rates and broader monetary policy.

Despite rising price pressures from tariffs, Fed Governor Christopher Waller suggested that interest rate cuts are still possible later this year, supporting gold’s appeal in a low-interest-rate environment.

In related markets, silver rose by 0.3% to $33.08 an ounce, while platinum and palladium fell by 0.4% and 0.3%, respectively.