By Eileen Soreng
BENGALURU (Reuters) - Gold prices gained on Tuesday, after hitting a more than one-month high earlier in the session, as the dollar slipped after the United States and China agreed to a temporary truce in their trade conflict that rattled global markets.
Spot gold rose 0.6 percent to $1,238.36 per ounce at 0824 GMT. Prices touched a peak of $1,238.83 earlier in the session, their highest since Oct. 26.
U.S. gold futures were up 0.3 percent at $1,243.4 per ounce.
"After the G20 summit safe haven buying in the dollar index has reduced therefore gold is looking very strong," said Vandana Bharti, assistant vice-president of commodity research, SMC Comtrade Ltd, adding $1,250 is the next target for the bullion.
The dollar weakened against its major peers on Tuesday, as the thaw in trade tensions between Washington and Beijing supported investor confidence in riskier assets, while the greenback was further pressured by U.S. Treasury yields that fell to three-month lows. [USD/]
Analysts now expect market focus to move to the U.S. Federal Reserve's monetary policy. Markets are expecting a fourth rate hike at its Dec. 18-19 meeting.
Gold has fallen about 10 percent from a peak in April as investors preferred the dollar as safe haven, with U.S.-China trade friction unfolding against a backdrop of higher U.S. interest rates.
"Participants will be keying in on policy language and the subsequent Powell news conference to see if there is any "walking back" of Powell's "neutral" remarks," INTL FCStone analyst Edward Meir said in a note.
"It (gold) is very close to taking out key resistance at $1,240/ounce. Should that level give away, we could see a modest flurry of fund activity setting in," Meir added.
Meanwhile, holdings in SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell 0.46 percent to 758.21 tonnes on Monday.
Among other precious metals, palladium had gained about 1 percent to $1,215.67 per ounce, having hit a record high of $1,221.95 in the previous session.
Spot silver was up 1 percent at $14.51 per ounce, while platinum dipped 0.3 percent to $804.09.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)