NEW YORK: Gold rose on Tuesday, recovering slightly from a retreat to an over one-month trough in the last session, as investors sought cover from fears of stalling global growth and soaring inflation.

Spot gold rose 0.4% to $1,904.36 per ounce by 10:40 a.m. ET (1440 GMT). Prices popped back above the key $1,900 level, after falling to $1,890.20 on Monday - its lowest since March 29.

US gold futures gained 0.3% to $1,902.30.

Some buying was re-emerging in safe haven products like gold, after news of China’s lockdown impacting demand in the energy and metals markets, said David Meger, director of metals trading at High Ridge Futures, also attributing the uptick to bargain hunting following the “overdone” dip.

While gold is considered a hedge against inflation and economic and political risks, including the Ukraine war, capping gains were expectations of rapid US rate hikes, which increase the opportunity cost of holding the non-yielding asset.

A higher dollar also slowed gold’s gains.

“The market is starting to believe that the Fed is willing to be a bit more aggressive and hence it has taken a little bit of the wind out of some of the sails of these commodities rallies,” Meger added.

The Fed is expected to raise rates by a half a percentage point at each of its next two meetings. But at the same time, this left markets worried that the aggressive tightening could derail the global economy.

Palladium, used primarily in vehicle exhausts to curb emissions, rose 1.4% to $2,174.08 per ounce, a day after concerns over reduced demand due to COVID lockdowns in China dragged it down as much as 12.9%.

“This year as semiconductor availability improves, we should see car demand rising... Yesterday’s fall should be a very good bargain hunting opportunity,” said WisdomTree analyst Nitesh Shah.

Silver fell 0.3% to $23.53 per ounce and platinum fell nearly 1% to $911.81.