Nov 26 (Reuters) - Gold prices edged up on Tuesday, having touched their lowest in over a week earlier in the session as safe-haven demand for the metal eased on optimism about a potential ceasefire between Israel and Hezbollah militants in Lebanon.
Spot gold was up 0.3% to $2,633.99 per ounce, as of 1217 GMT, after earlier hitting its lowest since Nov. 18. U.S. gold futures were up 0.6% to $2,634.10.
Gold fell over 3% on Monday, its deepest one-day decline in more than five months, on news that Israel looked set to approve a U.S. plan for a ceasefire with Iran-aligned Hezbollah, with further pressure from U.S. President-elect Donald Trump's nomination of Scott Bessent as U.S. Treasury secretary.
"Gold prices today are being influenced by the sustained risk appetite that gained momentum yesterday," said Ricardo Evangelista, senior analyst at ActivTrades.
"Positive geopolitical developments, including reports of a potential ceasefire between Israel and Lebanese militia, further dampened demand for the precious metal."
Trump pledging big tariffs on the United States' three largest trading partners - Canada, Mexico, and China - which could trigger trade wars and boost the metal's safe-haven appeal.
However, "tariffs introduce a range of uncertainties, including the risk of higher inflation, which could limit the scope for interest rate cuts and weigh on gold prices," said Zain Vawda, market analyst at MarketPulse by OANDA.
Investors are also waiting for U.S. consumer confidence data and the minutes from the Fed's November meeting due later on Tuesday.
"These reports are expected to play a pivotal role in shaping expectations about whether the Federal Reserve will proceed with a rate cut in December," Evangelista added.
According to the CME Group's FedWatch Tool, markets currently estimate a 56% chance of a 25-basis-point U.S. rate cut in December.
Lower interest rates reduce the opportunity cost of holding non-yielding gold.
Spot silver rose 0.8% to $30.54 per ounce, platinum edged 0.3% lower to $935.80 and palladium rose 1.4% to $986.75.
Reporting by Rahul Paswan in Bengaluru. Additional reporting by Swati Verma. Editing by Mark Potter
