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Gold traded up more than 1 percent to hit a one-week high on Tuesday as Middle East tensions intensified and U.S. President Donald Trump announced a 100 percent tariff on movies produced overseas, reigniting concerns about the potential fallout of a global trade war.
Spot gold climbed 1.2 percent to $3,372.27 per ounce in early European trade, while U.S. gold futures were up 1.8 percent at $3,382.46.
Six airstrikes hit Yemen's Hodeidah port, a day after the Iran-aligned Houthis fired a missile that landed near Israel's main airport in Tel Aviv. Several countries, including France and China, have strongly condemned Israel's plan to take full control of Gaza.
On the trade front, Trump's announcement of a 100 percent tariff on foreign-made movies has sent ripples through global entertainment circles. Industry figures are wondering how the proposal could possibly work.
In another development, Trump has signed an executive order as part of efforts to rebuild U.S. prescription drug manufacturing, with an eye on reducing reliance on foreign-made medicines.
Trump also warned that he will impose import tariffs on the pharma sector in the next two weeks.
All eyes are now on the Federal Reserve's policy meeting that gets underway later today. Policymakers are expected to keep rates steady, but Chair Jerome Powell's remarks could offer guidance in these uncertain times.
