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Investing.com-- Gold prices rose in Asian trade on Thursday, remaining in sight of record highs even as hopes of a Russia-Ukraine peace treaty sparked a risk-on move in broader financial markets.

Strength in metal markets came chiefly from a weaker dollar, which sank despite U.S. consumer price index inflation reading hotter than expected for January. The print further diminished expectations of interest rate cuts.

But gold was undeterred by the strong inflation data, remaining in sight of recent peaks as the threat of increased trade tariffs under U.S. President Donald Trump remained. Trump’s tariffs were a key driver of gold’s rally in recent weeks.

Spot gold rose 0.5% to $2,918.70 an ounce, while gold futures rose 0.6% to $2,947.0 an ounce by 23:59 ET (04:59 GMT). Spot prices remained close to a record high of $2,943.25 an ounce, hit earlier this week.

Trump talks up Russia-Ukraine peace treaty

Trump said Russian President Vladimir Putin and Ukraine President Volodymyr Zelenskiy had both expressed hopes for peace in separate calls with the U.S. President. Trump said he had instructed top U.S. officials to begin peace talks.

This came after U.S. Defense Secretary Pete Hegseth said Ukraine will no longer seek membership in the NATO alliance, or attempt to reclaim all of its territory captured by Russia. Ukraine’s NATO bid had been a major point of contention for Moscow, and was a driving force behind a full-scale invasion of Ukraine, launched in 2022.

But hopes for an end to the conflict- which is set to enter its fourth year in late-February- sparked a risk-on rally in broader financial markets. The war had disrupted global trade and triggered an energy crisis in Europe.

While improved risk appetite bodes poorly for safe havens, gold remained well-bid in the face of other uncertainties, especially on the rates and trade tariff front.

Other precious metals rose on Thursday. Platinum futures rose 1.2% to $1,057.65 an ounce, while silver futures rose 0.3% to $32.880 an ounce.

Among industrial metals, benchmark copper futures on the London Metal Exchange fell 0.1% to $9,474.75 a ton, while March copper futures rose 0.8% to $4.7265 a pound.

Rate jitters, trade tariff fears persist

Markets still remained on edge over U.S. interest rates remaining high for longer, after hotter-than-expected CPI data for January.

The print was followed by a testimony from Federal Reserve Chair Jerome Powell that the central bank will remain cautious over cutting rates further. Powell also said that strength in the U.S. economy gave the Fed enough headroom to take its time in cutting rates.

Markets also remained on edge over inflation being underpinned by increased U.S. trade tariffs- which will be borne by domestic importers.

Trump had earlier this week approved 25% tariffs on all steel and aluminum imports, and also flagged reciprocal tariffs on major U.S. trading partners.

Concerns over higher tariffs were a key driver of safe haven demand for gold.