Gold prices rose on Monday as the dollar remained subdued on fear of a global trade war.

Uncertainty over the outcome of elections in Italy, which could spell new concerns for the eurozone, gave further support to the metal.

Spot gold was up 0.3% at $1,326.41 an ounce at 4.14am GMT. Earlier in the session, it hit $1,327.03, its highest since February 27. US gold futures climbed 0.3% to $1,327.70/oz.

The dollar index, which measures the greenback against a basket of major currencies, was mostly unchanged at 89.971, after falling against most currencies on Friday.

The US currency slipped from the six-week high it touched on March 1, after US President Donald Trump announced plans to levy hefty tariffs on aluminium and steel imports — igniting fear of a trade war if its trade partners retaliate.

“Any escalation of trade wars will significantly dent the dollar appeal, weigh negatively on US assets such as bond and equities, and make gold the go-to hedge against rising US fiscal and political vulnerabilities,” Oanda Asia-Pacific trading head Stephen Innes said in a note.

A weaker dollar supports gold as it makes it cheaper for holders of other currencies to buy the metal.

“I think gold prices are up partly because of the uncertainty over the impact of the Italian election on the eurozone,” said Ji Ming, chief analyst, Shandong Gold Group.

Italian voters delivered a hung parliament on Sunday and, if early projections are confirmed, none of Italy’s three main groups will be able to rule alone. That leaves little prospect of a return to mainstream, moderate government, giving the European Union a new headache to deal with.

Investor appetite for a safe-haven asset such as gold rises during times of geopolitical and financial uncertainty.

Reuters technical analyst Wang Tao says spot gold could rise to $1,332/oz, as it has pierced above a resistance at $1,325.

In other precious metals, silver rose 0.6% to $16.58/oz.

Platinum inched 0.6% higher to $965.49/oz and palladium gained 0.3% to $994.50/oz.