Gold prices rose on Tuesday, hitting a one-month high as the dollar weakened, but gold retraced gains as US President Donald Trump laid out aggressive plans for infrastructure spending and deregulation. Gold touched $1,261.15, its highest since Feb. 27 as the dollar weakened after the US Institute for Supply Management said its index of national factory activity fell in March, while automakers reported a drop in US sales.
Spot gold was up 0.2 percent at $1,255.2 an ounce by 2:01 EDT (1801 GMT). US gold futures ended the session 0.4 percent higher at $1,258.4. "Gold is ... again trading at the technically important 200-day moving average," Commerzbank said in a note. Yet investors remained cautious ahead of a meeting between US and Chinese leaders, as well as the upcoming French presidential election.
Investor interest can be seen in holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, which climbed 0.53 percent to 836.77 tonnes on Monday from 832.32 tonnes on Friday. On the technical front, gold needs to close above the 200-day moving average, currently around $1,259, to gather momentum for $1,263.80, the Feb. 27 peak, chart analysts said. Spot silver rose 0.3 percent to $18.27, having hit a one-month high at $18.412 an ounce. Platinum gained 0.9 percent to $960.3 and palladium added 0.5 percent to $806.7.