Investing.com - Gold prices inched up on Thursday, as the U.S. announced it was going ahead with planned tariffs against its allies and investors brace for a potential global trade war.

U.S. Commerce Secretary Wilbur Ross announced that America was going ahead with metal tariffs against the European Union, Mexico and Canada, effective at midnight on Thursday.

The tariffs will be 25% on steel and 10% on aluminum. The decision on tariffs on Mexico and Canada was taken after talks on the North American Free Trade Agreement took too long.

Comex gold futures for June delivery were up 0.32% to $1,305.70 a troy ounce as of 10:57 AM ET (14:57 GMT). Gold, seen as a safe haven asset, often moves higher from political turmoil.

The price of bouillon was also driven up by a fall in the greenback, despite upbeat economic data.

The Personal Consumption Expenditures inflation data rose to 0.6% in April while jobless claims fell. The Federal Reserve uses core PCE as a tool to help determine whether to raise or lower interest rates, with the aim of keeping inflation at a rate of 2% or below.

The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was at 94.00, falling 0.06%.

Gold is denominated in the U.S. currency and is sensitive to moves in the dollar. Bullion becomes more expensive for holders of other currencies when the dollar rises.

Elsewhere on the Comex, silver futures were up 0.13% to $16.565 a troy ounce. Among other precious metals, Platinum Futures rose 0.39% to $912.00 while Palladium Futures increased 0.66% to $981.40 an ounce. Copper futures jumped 0.39% to $3.081 a pound.