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Gold increases over 1%, as dollar rally stops and trade worries resurface

The gold price increased by more than 1% Thursday, moving from the low of one month it reached in the previous session. A pullback in dollar value and new U.S. Tariff announcements boosted demand for this safe-haven investment.

As of 0612 GMT, spot gold was up 1.1%, at $3,312,03 per ounce. On Wednesday, the bullion reached its lowest level since 30th June at $3267.79.

U.S. Gold Futures rose 0.4% to $3.309.

Gold became less expensive for holders of other currencies as the dollar dropped from its two-month low.

Gold prices dropped sharply yesterday, around the time of the FOMC's statement and the announcement on tariffs. A moderately weaker U.S. Dollar is helping gold today, said UBS commodity analysts Giovanni Staunovo.

Before the deadline of August 1, U.S. president Donald Trump announced new levies, including updates on copper tariffs, taxes on goods imported from Brazil, South Korea, and India, as well as a halt to exemptions on small overseas shipments.

Trump announced on Wednesday that the U.S. will impose a 15% duty on South Korean imports as part of a deal to avoid higher tariffs. He expressed optimism in the trade negotiations with China and said he expected a fair agreement to be reached.

Powell stated that it is too early to predict whether the Fed will cut rates during its next meeting, scheduled for September.

In an environment of low interest rates, gold tends to do well.

The World Gold Council reported on Thursday that global gold demand including OTC trading increased by 3% annually to 1,248.8 tons in the second half of 2025, as investment rose 78%.

The focus now shifts to the U.S. Core PCE Index data, due later today. This will be followed by U.S. Non-Farm Payrolls on Friday. These two events should provide more clues about Fed rate path.

(Reporting by Brijesh Patel in Bengaluru; Editing by Janane Venkatraman) (Reporting from Brijesh Patel in Bengaluru, Editing by Janane Vekatraman.)

(source: Reuters)