(Reuters) - Gold hit a new peak on Friday, surpassing the key $3,200 an ounce mark for the first time, as a weak dollar and escalating trade war drove investors to safe-haven assets.
Spot gold rose 1.3% to $3,216.48 an ounce by 0230 GMT. Bullion touched an all-time peak of $3,219.73 early in the session, rising more than 5% for the week.
U.S. gold futures rose 1.9% to $3,236.00.
"The rapid weakening of the U.S. dollar appears to be the main driver of gold's comeback at the moment. This seems to reflect the ongoing exodus from U.S.-based assets, with selling of stocks and bonds amid tariff policy uncertainty," said Ilya Spivak, head of global macro at TasteLive.
The dollar declined, making dollar-denominated bullion cheaper for foreign buyers.
Major stock indexes also fell after U.S. President Donald Trump raised tariffs on Chinese imports to 145% but extended a 90-day moratorium on previously announced tariffs for dozens of countries.
China has been raising its tariffs in tandem with each tariff hike by Trump, raising fears that Beijing could raise tariffs on the U.S. beyond the current 84%.
"$3,500 is the next round number people will be watching. I suspect we won't get there immediately or without a hitch," said Kyle Rodda, financial markets analyst at Capital.com.
Apart from tariffs, central bank demand, expectations of interest rate cuts by the Federal Reserve, geopolitical instability in the Middle East and Europe and rising inflows into gold-backed exchange-traded funds also fueled the metal's rally this year.
Data showed U.S. consumer prices unexpectedly fell in March, but inflation risks remain tilted to the upside.
Traders now believe the Fed will resume rate cuts in June and possibly cut rates by a full percentage point by the end of 2025.
Spot silver fell 0.2% to $31.13 an ounce and platinum fell 0.4% to $934.20. Palladium rose 0.7% to $914.70.
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