Gold climbed for a second day on optimism that the Federal Reserve will resume rate cuts this half, while investors continued to monitor US trade talks before a July 9 tariff deadline. 

Bullion rose 0.6% to near $3,323 an ounce, after gaining 0.9% on Monday as traders priced in higher odds of at least two US rate reductions in 2025. A jobs report on Thursday also looms as a potential catalyst for a drop in yields on Treasuries — a scenario that typically tends to benefit gold.

Gold is up by more than a quarter this year, and is trading less than $200 short of April's record, supported by elevated trade and geopolitical risks. Uncertainty over US President Donald Trump's tariff and fiscal agendas on the long-term structure of the economy saw a gauge of the dollar drop almost 11% in the first six months of year, the worst performance since 1973.

"Gold, despite its recent losses, has the most potential to gain in the short term if the US dollar continues to decline," Commonwealth Bank of Australia analyst Vivek Dhar said in a note.

Read More: Goldman Sachs Pulls Forward Fed Rate-Cut Forecast to September

Spot gold was up 0.6% to $3,322.64 an ounce at 12:51 p.m. in Singapore. The Bloomberg Dollar Spot Index slipped 0.1%, after falling 0.5% Monday. 

Platinum dipped after surging almost 29% in June, its best monthly performance. The rally has been driven by signs of extreme tightness in the spot market amid strong demand from Chinese jewelry manufacturers, as well as speculative buying led by the US and China. Silver and palladium advanced.

Source: Bloomberg