Gold extended gains - following a surge of almost 3% on Monday - as the world's biggest bullion buyer came back from holiday, boosting demand despite a firmer dollar.
The precious metal rose as much as 1.6% to above US$3,387 ($4,382) an ounce as China returned from a five-day break. Buyers have been piling into gold on the conviction that it's record-setting rally still has room to run.
"Dip buyers returned to markets as China reopened this morning," said Priyanka Sachdeva, an analyst at Phillip Nova. A stronger dollar today will likely keep a lid on further upward momentum for gold, she added.
Bullion's status as a safe haven has been reinforced by the market chaos unleashed by US President Donald Trump's aggressive trade policy. His moves to impose, then pause, sweeping tariffs on imports have undermined the dollar's traditional role as a haven and led investors to boost allocations away from US assets.
The precious metal has surged by more than a quarter this year, hitting a record just above US$3,500 an ounce in April, before losing some ground in the last couple of weeks. The ascent has been driven by haven buying as the trade war unnerved investors, as well as by speculative demand in China and central-bank buying.
See also: Gold tumbles on trade signals as volatile week winds to a close
Spot gold rose 0.8% to US$3,359.61 an ounce at 12.28 pm in Singapore. That was in spite of a stronger greenback, with a gauge of its strength advancing as much as 0.2% after data showed activity at US service providers accelerated in April. Silver, palladium and platinum climbed.
Elsewhere, investors are looking ahead to the US Federal Reserve's (US Fed) midweek interest-rate decision.
Policymakers are widely expected to hold rates steady when they conclude their meeting on Wednesday, despite Trump ratcheting up pressure on chair Jerome Powell to loosen. Lower borrowing costs tend to benefit bullion as it doesn't pay interest.
