· Spot gold was up 0.3 percent at $1,298.98 per ounce at 0635 GMT.
· U.S. gold futures for August delivery were 0.1 percent higher at $1,303.10 per ounce.
· "Geopolitical tensions are providing (only) limited support to gold prices ... a recovery in the U.S. economy could lead the central bank to have more rate hikes this year, and hence, the upward momentum in gold is not that strong, said Mark To, head of research at Hong Kong's Wing Fung Financial Group.
· "$1,300 should be the level around which the gold price is going to move at this moment," To said.
· However, slightly lower U.S. bond yields and a softer greenback, provided support to dollar-denominated gold, OCBC said in a note.
· The dollar index , which measures the greenback against a basket of six major currencies, fell 0.2 percent to 93.705.
· Treasury yields fell on Tuesday as traders piled back into lower-risk government debt after Italy's new prime minister vowed to enact economic policies that could balloon the nation's already-heavy debt load.
· Meanwhile, Mexico on Tuesday imposed tariffs on American products ranging from steel to pork and bourbon in retaliation against import duties on metals imposed by U.S. President Donald Trump last week.
· White House economic adviser Larry Kudlow said on Tuesday that Trump is considering holding separate talks with Canada and Mexico, reviving the possibility that the president will seek to replace the North American Free Trade Agreement (NAFTA).
· In other precious metals, silver gained 0.6 percent to $16.55 an ounce.
· Platinum was up 0.3 percent at $903.50 an ounce and palladium was 0.1 percent higher at $994.50 per ounce.
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