Gold prices rose more than 1% on Tuesday as investors sought safe-haven assets after US President Donald Trump's "big, beautiful bill" passed the Senate, ahead of a July 9 trade tariff deadline.

Spot gold rose 1.1% to $3,338.24 an ounce, as of 2:25 p.m. EDT (1825 GMT), its highest since June 24. US gold futures settled 1.3% higher at $3,349.8.

The Republican-controlled US Senate voted on Tuesday to pass a sweeping tax-cut and spending bill demanded by Trump, which would slash some social service programs.

"The budget bill that passed is encouraging as it looks to contribute to a $3 trillion deficit over the next 10 years," said Marex analyst Edward Meir.

"It's inflationary to some extent, and more importantly, it's going to increase the debt burden that we have to pay off with more financing, more borrowing, and all of those things are constructive for a stronger gold market." Gold, considered a store of value, tends to thrive in political and economic uncertainty.

U.S. Treasury Secretary Scott Bessent warned that countries could be told to expect much higher tariffs despite good-faith negotiations ahead of July 9, when tariffs are scheduled to return from the temporary 10% level to Trump's suspended 11% rate to 50%. Investors are eyeing U.S. ADP jobs data due on Wednesday and payrolls data on Thursday to gauge the Federal Reserve's policy path.

Fed Chairman Jerome Powell said that excluding tariffs, inflation is behaving as expected. Markets are currently expecting two interest rate cuts totaling 50 basis points this year, starting in September. Lower rates boost the appeal of non-yielding bullion. Gold is likely to average $3,000/oz for the fourth quarter and possibly even lower by the end of the year, said Rhona O'Connell, head of market analysis for EMEA & Asia at StoneX.

Spot silver rose 0.1% to $36.11 an ounce, while palladium held steady at $1,097.16, and platinum fell 0.7% to $1,342.78. (alg)

Source: Reuters