Gold price continues to benefit from haven flows amid escalating geopolitical tensions

Investors remain concerned about the risk of a further escalation of geopolitical tensions between Russia and Ukraine, which drives haven flows towards the Gold price for the third straight day.

Russian President Vladimir Putin upped the ante on Tuesday and signed a decree approving its updated nuclear doctrine, which shifts the parameters on when Russia can use nuclear weapons.

Ukraine acted on the go-ahead from the US to use American-made missiles for strikes within Russia and launched ATACMS missiles to attack a Russian military facility in the Bryansk border region.

Russian Foreign Minister Sergei Lavrov said the country will do everything possible to avoid a nuclear war. The White House confirmed that the US does not plan to adjust its nuclear posture. 

Markets have been positioning for potential tariffs and tax cuts by the incoming Trump administration, which could lead to higher inflation and fewer interest rate cuts by the Federal Reserve.

Kansas Fed President Jeffrey Schmid said on Tuesday that large fiscal deficits will not cause inflationary pressures because the central bank will prevent it, though that could mean higher interest rates.