By Barani Krishnan
Investing.com - Gold longs ought to be thankful to China as both good or bad news about the People's Republic helps the yellow metal get a bid.
While hopes for a U.S.-China trade deal in the past boosted bullion on expectations that Chinese jewelry consumption will rise as a result, now concerns that the same negotiations may be scuttled are helping gold rally as a safe haven.
Spot gold, reflective of trades in bullion, was up $3.97, or 0.3%, at $1,284.42 per ounce by 4:54 PM ET (20:54 GMT).
Gold futures for June delivery, traded on the Comex division of the New York Mercantile Exchange, settled up $1.80, or 0.1%, at $1,285.60 per ounce.
It was the second day in a row that gold had risen. Monday's higher settlement came on the back of U.S.-Iran saber-rattling, which again boosted gold's safe-haven edge despite a rise in its rival, the dollar.
The dollar index, which measures the greenback against a basket of six currencies, finished up 0.13% at 97.399.
Risk aversion heightened across Wall Street and other global markets on Tuesday as traders reacted again to threats made over the weekend by President Donald Trump to hike tariffs already in place on $200 billion of Chinese imports, as well as levy new duties on hundreds of billions of dollars' worth of other imports.
"Too many headlines and conflicting trade tensions" steered investors off equities and other risk assets, leading to gold's rebound, said George Gero, precious metals analyst at RBC Wealth Management in New York.
Quantitative Commodity Research analyst Peter Fertig agreed, saying Trump's tweets from Sunday had formed a new support base for gold on China.
"This is a situation where gold is seen as a safe haven" versus bids bullion attracted earlier on hopes that a U.S.-China deal will spur more Chinese consumption of gold, Fertig said.
Elsewhere in metals, palladium fell more than 1%, continuing with its choppy trend amid concerns that prices of the auto-catalyst metal may have risen too much, too soon in recent months.
Spot palladium was down $16.10, or 1.2%, at $1,327.75 an ounce.
Trades in other Comex metals as of 4:59 PM ET (2580: GMT):
Palladium futures down $7.35, or 0.6%, at $1,320.75 per ounce.
Platinum futures down $7.90, or 0.9%, at $873 per ounce.
Silver futures flat at $14.92 per ounce.
Copper futures down 4 cents, or 1.5%, at $2.79 per pound.