Gold up amid concerns over Italy elections

london — Gold touched a near one-week high on Monday as investors opted for safe-haven assets on political uncertainty in Italy and fears of a potential escalation of a simmering global trade war.

Spot gold was up 0.3 per cent to $1,325.91 per ounce by 1105 GMT after touching its highest since February 27 at $1,327.86. US gold futures for April delivery rose 0.3 per cent to $1,327.20 per ounce.

Gold is often seen as an alternative investment during times of geopolitical and financial uncertainty, benefiting along with other haven assets such as the Japanese yen and US Treasuries while stocks tend to trend lower.

“There are fears that a global trade war or protectionist measures will undermine global growth,” said Societe Generale’s head of metals research Robin Bhar. “People have wanted gold as a hedge against those looming uncertainties”

The dollar index was steady, having touched its lowest in almost a week earlier in the session. The US currency slipped from its six-week high that it touched on March 1, after US President Donald Trump announced plans to levy hefty tariffs on aluminium and steel imports which were followed by threats of retaliation from the EU and Canada.

A weaker dollar supports gold, making it cheaper for holders of other currencies.

In other metals, Zinc slid to a two-month low on Monday, falling for a fifth straight session as inventories surged and as concerns about proposed US trade tariffs weighed on metals used in steel manufacturing.

Zinc, which is most commonly used to galvanise steel, has fallen nearly 8 per cent since hitting its highest in more than a decade last month, at $3,595.50 a tonne.