Gold price (XAU/USD) rises to a fresh record high near $4,675 during the early Asian session on Monday. The precious metal gains momentum after US President Donald Trump said he would slap tariffs on eight European nations that have opposed his plan to take Greenland.

Trump announced a 10% tariff on goods from countries including Denmark, Sweden, France, Germany, the Netherlands and Finland, along with the United Kingdom (UK) and Norway, starting from February 1, until the US is allowed to buy Greenland. The move sparked fears of retaliation from Europe, supporting traditional safe-haven assets such as Gold.  

European Union (EU) ambassadors reached a broad agreement on Sunday to intensify efforts to dissuade Trump from imposing levies on European allies, while also preparing retaliatory measures should the duties go ahead.

On the other hand, a slew of US economic data, including improving US labor market data, have lowered the implied probabilities of imminent US Federal Reserve (Fed) rate cuts. Fed funds futures have pushed back expectations for the next rate cut to June and September from January and April. 

The view that the US central bank can keep interest rates higher for longer generally underpins the US Dollar (USD) and weighs on the non-interest-bearing assets like Gold.