09:23 AM EST, 02/26/2025 (MT Newswires) -- Gold rose early on Wednesday as safe-haven demand continues on expectations U.S. President Donald Trump next week will follow through on promises to launch a trade war against Canada and Mexico, the two largest U.S. trading partners.

Gold for April delivery was last seen up US$5.80 to US$2,924.60 per ounce, following a day-prior drop of 1.5% after closing at a record US$2,963.20 on Monday.

President Trump is planning to impose a 25% tariff on imports from its two neighbors on March 4, after earlier this month delaying them for 30 days. Trump has also placed a 10% tariff on imports from China and is threatening to impose levies on goods from Europe.

The threat of a spreading trade war that would cut into the global economy and boost inflation is unsettling markets and consumers. The Conference Board on Tuesday reported U.S. consumer confidence this month fell to the lowest in more than three years.

The economic uncertainty is pushing investors away from risk assets and towards the safety of gold, which is considered a safe store of value.

"Trump's trade war rhetoric (is spurring) safe-haven demand," Saxo Bank noted.

The dollar rose, with the ICE dollar index last seen up 0.26 points to 106.58.

Treasury yields rose, with the U.S. two-year note last seen paying 4.125%, up 2.9 basis points, while the yield on the 10-year note was up 0.2 basis points to 4.303%.