Gold futures ticked to a two week high as violence in Ukraine fueled safe-haven buying.
The most actively traded gold contract, for June delivery, ended up 0.8 per cent, or $US10.80, at $US1,309.10 a troy ounce on the Comex division of the New York Mercantile Exchange, the highest settlement since March 25.
Investors are concerned that upheaval in Ukraine could lead to a larger conflict between Russia and the West. Gold tends to hold its value during international crises.
“That’s what has gold up, the tensions with Russia,” said Fain Shaffer, president of Infinity Trading Corp, a brokerage in Indianapolis.
The US, Germany and the UK said Russia appeared to be destabilising the situation in eastern Ukraine.
Ukrainian police regained control of a government building occupied by pro-Russian separatists in one city, but Russia warned the use of force to dislodge demonstrators could plunge the country into civil war.
A weaker dollar also boosted buying interest in the precious metal, analysts said.
When the US currency weakens, it makes dollar priced gold seem less expensive for buyers using foreign currencies.
On Wednesday, the market will be watching the release of the Federal Reserve meeting minutes for clues on what monetary policy steps the US might take next.