At the close of trading on 21/7, the spot price of gold increased by 48 USD to 3,395 USD per ounce. This is the highest level since 17/6. By the morning of 22/7, the price had settled at 3,390 USD.

The market's upward trend on Monday was driven by a decline in both the US dollar and US government bond yields, as the August 1 deadline looms. Countries are required to reach trade agreements with the US before this date to avoid higher import tariffs.

Global gold prices surged on 21/7. Chart: Kitco

The Dollar Index fell 0.6% on 21/7, making gold cheaper for buyers using other currencies. The yield on 10-year US Treasury notes also dropped to its lowest point in over a week.

"As the August 1 deadline approaches, market instability increases. This is a factor supporting gold prices," said David Meger, director of metals trading at High Ridge Futures.

European Union (EU) officials told Reuters that the bloc is preparing countermeasures as the possibility of a trade agreement with the US seems increasingly remote. In addition to trade tensions, rumors of a potential earlier-than-expected interest rate cut in the US, the possible replacement of Federal Reserve Chairman Jerome Powell, and potential restructuring of the Fed are also causing market concern, Meger said.

Investors are currently placing a 59% probability on a Fed rate cut in September. Gold is considered a safe haven asset during times of uncertainty and tends to appreciate in a low-interest-rate environment.

In the physical market, data shows that China, the world's top gold consumer, purchased 63 tons of the precious metal last month. This is the lowest level since January. The country's platinum imports also decreased by 6.1% compared to the previous month.

In addition to gold, other precious metals also saw price increases on 21/7. Silver rose 2.1% to 38.9 USD an ounce. Platinum gained 1.4%, and palladium increased 2.1%.

Ha Thu (according to Reuters)