Investing.com - Gold prices inched higher on Tuesday as increased risk appetite limited gains in the precious metal, keeping it close to the low for the year hit a day earlier.
At 10:17AM ET (14:17GMT), gold futures for June delivery on the Comex division of the New York Mercantile Exchange was up just $0.40, or around 0.03%, to $1,291.30 a troy ounce. In the previous session, it slid to as low as $1,281.20, its weakest level since December 27.
News that China plans to slash auto import tariffs eased concerns over the possibility of a Sino-U.S. trade war. Beijing said it would lower tariffs to 15% from the current 20% to 25% starting July 1, while tariffs on auto parts would be cut to 6% from around 10%.
With no major economic data on Tuesday’s calendar, investors looked ahead to the release of the minutes from the last Federal Reserve policy decision on Wednesday.
Traders also had a break from policymakers while gearing up for an appearance from Fed chairman Jerome Powell who will participate in a panel discussion of "Financial Stability and Central Bank Transparency" at the Sveriges Riskbank Conference in Stockholm, Sweden on Friday.
Expectations that the U.S. central bank will lift U.S. interest rates again next month have added to recent downward pressure on gold.
Higher U.S. rates tend to boost the dollar and push bond yields up, make non-yielding assets like bullion less attractive.
Odds for a total of four rate hikes this year have pushed beyond the 50% threshold this week and markets will be closely watching the June 12-13 meeting to see if the Fed increases its forecast from their prior expectations for just three hikes in 2018.
In other metals trading, silver futures rose 0.2 at $16.560 a troy ounce by 10:21AM ET (14:21GMT).
Palladium futures were unchanged $990.40 an ounce, while sister metal platinum gained 0.6% at $905.50.
In base metals, copper traded up 1.2% to $3.135 a pound as China’s tariff cuts supported optimism for global growth.