09:37 AM EDT, 06/02/2025 (MT Newswires) -- Gold was sharply higher early on Monday, supported by a weaker dollar amid further U.S. tariff hikes and rising safe-haven demand.

Gold for August delivery was last seen up US$71.90 to US$3.387.30 per ounce.

The rise follows on heightened geopolitical tensions after Ukraine over the weekend launched widespread drone attacks on Russia's fleet of strategic bombers, with Kyiv saying it damaged or destroyed more than 40 planes. Russia responded with attacks on Ukrainian targets overnight, as both sides sought to enter Monday's ceasefire talks in Istanbul in a stronger negotiating position.

Also over the weekend, U.S. President Donald Trump said he will double tariffs on steel imports to 50% effective on Wednesday, continuing the capricious trade policies that have slowed the global economy. The Wall Street Journal reported the European Union may impose retaliatory duties following the unexpected hike, undermining trade talks between it and the United States.

The dollar was sharply lower early, supportive of commodities priced in the currency. The ICE dollar index was last seen down 0.5 points to 98.83. Treasury yields rose, with the U.S. two-year note was last seen paying 3.935%, up 2.7 basis points, while the yield on the 10-year note was up 3.9 points to 4.447%.