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· Gold held steady on Monday as the dollar eased and investors sought clarity on the fine print of the "phase one" U.S.-China trade deal, offsetting strong gains in the equities markets.

· Spot gold was little changed at $1,476.19 per ounce by 01:35 p.m. ET (1835 GMT). Prices gained 1.1% last week as the world's two largest economies negotiated ahead of another potential round of tariffs.

U.S. gold futures settled mostly unchanged at $1,480.50 per ounce.

· "This (trade deal) does not mean things get fundamentally better; it essentially means they're not going to get any deeper into a slowdown. ... There still are risks down the road," said Bart Melek, head of commodity strategies at TD Securities.

"A combination of expectations of high (trade) deficit, lower interest rates and U.S. political risks emerging during election year, all point to investors wanting to at least have some gold in their portfolio."

· Washington and Beijing cooled their tariff dispute last week, reducing some U.S. tariffs in exchange for what U.S. officials said would be a big jump in Chinese purchases of American farm products and other goods.

· This bolstered risk sentiment, with Wall Street at record highs.

However, the much-awaited initial deal failed to trigger any sharp sell off in gold. It shook off some initial pressure from early in the Asian session.

· "The markets lack conviction to push bullion lower as there still remain concerns about what this deal entails and how much this phase one agreement will alleviate the downward pressure on the global economy going into 2020," said FXTM market analyst Han Tan.

"These overall concerns are still keeping gold prices relatively elevated."

· The 17-month long trade war has fanned concerns of a global economic slowdown, prompting major central banks to ease monetary policy.

· The gold market will be watching closely in 2020 for signs on whether the U.S. Federal Reserve and other major central banks will cut interest rates.

The Fed last cut in October, and then left rates alone at the December policy meeting. Economists suggested that the Fed may be done for now, but may still have a slightly dovish tilt.

If so, several observers said the current low-rate environment should still help the precious metal. And if the Fed cuts some more after all, look for gold to make another leg higher.

“When the Fed started cutting rates, gold took off,” said Colin Cieszynski, chief market strategist at SIA Wealth Management. “It was acting as a hard currency and people were starting to devalue the paper currencies.

“If the central banks continue to put in stimulus and devalue their currencies, that could be beneficial to gold.”

· A large amount of negative-yielding debt around the world creates a favorable backdrop for gold, she said. Standard Chartered looks for the Fed to remain on hold with rates in 2020. However, the global economy may start slowing late in the year, meaning potential for a cut in 2021, Cooper continued. The U.S. dollar may begin softening, although not dramatically, and Treasury yields are likely to soften in the second half, the analyst continued.

“So we think a lot of these macro factors are likely to align themselves to support gold in H2,” Cooper said.

· Phil Flynn, senior market analyst with at Price Futures Group, said the Fed appears focused keeping rates low, thus allowing inflation to grow.

“In fact, they are sending signals that they are going to allow inflation to run hot even if it does reappear,” Flynn said. “So even if the Fed gets to its 2% inflation rate [target], they might allow it to go to 3% or 4% before they really put the brakes on it.”

Flynn said a pick-up in inflation should prompt buying of gold as a hedge against rising prices. Low interest rates also help gold other ways, such as holding back the U.S. dollar and reducing the so-called “opportunity cost,” which is lost interest earnings from holding a non-yielding asset such as gold.

· Palladium jumped 2.4% to $1,977.28 an ounce after hitting a fresh record high of $1,991.38.

· Platinum edged 0.1% higher to $928.93, while silver gained 0.7% to $17.05.

· While palladium's bull run has been underpinned by a structural deficit, platinum has been in a surplus, Wall Street bank Goldman Sachs said in a note.

"However, substitution of palladium for platinum is unlikely to happen until extreme physical shortages develop which create problems in producing automobiles to force the automakers to make expensive investments to make the switch. Until then, palladium will likely continue to outperform platinum."

Reference: Reuters, Kitco