Gold prices rose during Asian trading on Tuesday, demonstrating demand amid growing uncertainty about U.S. trade policy and interest rates, while the recent strengthening of the dollar had little effect on the value of the precious metal.

Increased risk appetite, as U.S. lawmakers neared the end of the country's longest government shutdown, also had little effect on gold, as markets remain concerned about the economic consequences of the shutdown.

Demand for gold remains despite progress on the shutdown

Investors mostly remained committed to gold, even though progress in ending the long-term shutdown in the United States helped improve risk appetite, albeit only marginally.

The yellow metal recovered sharply to above the coveted $4,000 per ounce mark this week, largely ignoring pressure from a stronger dollar.

The U.S. Senate on Monday evening approved a bill to unlock additional funding and end the longest government shutdown in history, which has been going on for 41 days.

The bill will be considered in the House of Representatives on Wednesday, with the Republican majority in the House signaling that it will approve the measure.

Other precious metals also rose after gold. Spot platinum rose 0.7% to $1,587.48 per ounce, while spot silver rose 0.9% to $50.9685 per ounce.

ANZ analysts said the recent rise in gold was driven by demand for safe assets amid heightened uncertainty over U.S. trade tariffs and the broader economy.

They noted that the Supreme Court recently criticized the Trump administration for using the emergency law to advance its tariff agenda, which could be considered unconstitutional.

Trump warned on Monday evening that canceling his tariffs could cost the government more than $2 trillion in back taxes.

"Regardless of whether the court rules that Trump unlawfully imposed tariffs by invoking the International Emergency Economic Powers Act of 1977, it is likely that he can rely on other laws if necessary. In the meantime, the market is likely to face months of uncertainty as a decision is not expected until the end of the year," ANZ analysts wrote in a note.

As for the economy, markets remain uncertain about the U.S. economy, especially as the shutdown delayed the release of several key official indicators.

It was also observed that traders are cutting bets that the Federal Reserve will further cut interest rates in December.