Gold prices hit over three-week high on Monday as the U.S. dollar weakened broadly after the U.S. and China agreed to a 90-day truce on their escalating trade war during a weekend meeting in Argentina.
Spot gold climbed 0.75 percent to $1,229.37 per ounce after having touched as high as $1,231.34, the highest level since November 7 earlier in the session. U.S. gold futures were up 0.7 percent at $1,234.70 per ounce.
The dollar has been on a weaker footing after U.S. President Donald Trump agreed to hold off on his threat to slap 25 percent tariffs on USD 200 billion worth of Chinese goods from January 1.
On its part, Beijing agreed to buy very substantial amount of agricultural, energy, industrial and other products from the U.S. to narrow its trade gap with the U.S.
Also, the dollar's slide comes in view of expectations that the Federal Reserve will likely ease up on its plans for multiple interest rate hikes next year.
Fed Chair Chairman Jerome Powell said last week that interest rates are just below neutral, raising expectations that the U.S. central bank will pause its interest rate hike agenda after December.
Powell is scheduled to testify before a congressional Joint Economic Committee later this week.
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