Gold prices hit a more than seven-month high on Tuesday as investors shun riskier assets on worries over escalation in Sino-U.S. trade tensions after the U.S. Justice Department charged China's Huawei Technologies Co Ltd with fraud.
Spot gold rose to its highest since June 14, 2018 at $1,306.43 and was up 0.2 percent at $1,306.11 per ounce by 0715 GMT. U.S. gold futures were up 0.1 percent at $1,304.70 per ounce.
"Investors are very cautious with many uncertainties on U.S.-China trade talks and Brexit. Huawei is at the centre of dispute, creating very noisy background for the trade talks," said Margaret Yang, a market analyst at CMC Markets.
"All these are making it more difficult for investors to judge the market's direction. Money is fleeing into assets such as gold, seeking safety."
The United States on Monday charged Huawei, its chief financial officer and two affiliates with bank and wire fraud to violate sanctions against Iran in a case that has escalated tensions with Beijing.
Investors fear the charges could complicate high-level trade talks set to begin on Wednesday where Chinese Vice Premier Liu He will meet with U.S. Trade Representative Robert Lighthizer and others.
The dollar index, a gauge of its value versus six major peers, held close to a two-week low, while Asian shares fell.
Meanwhile, the U.S. Federal Reserve's two-day policy meeting begins later in the day, where the central bank is expected to leave interest rates unchanged.
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