Gold gains on softer dollar, mounting Trump tariff concerns

Gold prices firmed on Monday, helped by a weaker U.S. dollar and rising fears that U.S. President Donald Trump's tariff threats could lead to a global trade war and stoke inflation, thereby fuelling safe-haven demand for the metal.

FUNDAMENTALS

* Spot gold was up 0.3% at $2,868.29 an ounce, as of 0010 GMT. U.S. gold futures rose 1.1% to $2,880.70.


* The dollar index fell 0.3% from a two-week high hit in the previous session, making bullion less expensive for other currency holders.

* U.S. Commerce Secretary Howard Lutnick said on Sunday that tariffs on Canada and Mexico will go into effect on Tuesday, but Trump will determine whether to stick with the planned 25% level.

* Trump also said he would add another 10% tariff on Chinese goods on Tuesday, effectively doubling 10% duties imposed on February 4.

* On Friday, U.S. consumer spending unexpectedly fell in January, but a pick up in inflation could provide cover for the Federal Reserve to delay cutting interest rates for some time.

* Traders of futures contracts that settle to the Fed's policy rate maintained bets that the U.S. central bank will restart cuts to short-term borrowing rates in June after data showed inflation rose in line with expectations in January.

* In other metals, spot platinum gained 0.4% to $950.94 an ounce and palladium firmed 1.2% to $929.72.

* Demand for industrial precious metals platinum and palladium will likely fall if tariffs proposed by Trump on U.S. auto imports dampen vehicle sales, analysts said.

* Spot silver was up 0.1% at $31.18.

DATA/EVENTS (GMT) 0030 Japan JibunBK Mfg PMI Final SA Feb 0145 China Caixin Mfg PMI Final Feb 0850 France HCOB Manufacturing PMI Feb 0855 Germany HCOB Mfg PMI Feb 0900 EU HCOB Mfg Final PMI Feb 0930 UK S&P GLOBAL MANUFACTURING PMI Feb 1000 EU HICP Flash YY, HICP-X F,E,A&T Flash YY, HICP-X F, E, A, T Flash MM Feb 1445 US S&P Global Mfg PMI Final Feb 1500 US ISM Manufacturing PMI Feb.