Gold prices continued to recover as investors sought safe-haven assets while they monitored global trade developments. President Trump’s newly imposed tariffs on goods from Mexico, Canada and China prompted swift retaliatory measures and fueled growth concerns.

Trade tensions could bolster gold’s appeal as a hedge against uncertainty. However, they could also lead to inflationary pressures, prompting the Federal Reserve to maintain a cautious stance and hold interest rates for an extended period, which could limit gold's rally.

Today’s ISM Services PMI could affect sentiment and economic growth expectations. Strong data could reinforce the dollar and dampen gold’s appeal, while weaker figures could further support bullion.

Beyond trade, geopolitical risks will also play a crucial role in shaping market sentiment. Ongoing uncertainty surrounding the Russia-Ukraine conflict could fuel a risk-off sentiment among traders, which could sustain gold’s upward trajectory in the short term.