The precious metal rose above $3,200 on Monday after suffering its steepest weekly drop in six months, as safe-haven appeal waned on concerns about the US economic outlook and budget deficit.
At 9.15am, gold was at $3,233.94, up 0.93% since it opened early Monday in Asian trading.
On Friday, Moody’s Ratings downgraded the US government’s credit rating, stripping it of its last triple-A rating, citing a large fiscal deficit and rising interest costs.
Gold fell more than 3%, marking its worst performance since November as heightened risk appetite from the US-China trade deal weighed on markets.
The two economic giants agreed to a 90-day temporary reprieve on most tariffs imposed on each other’s goods since early April, easing fears of a global recession.
Meanwhile, slowing inflation data and weaker-than-expected economic indicators in the US have reinforced expectations of more interest rate cuts by the Federal Reserve later this year.
