Gold prices saw a slight increase in Asian trading on Monday, driven by geopolitical tensions in Syria and South Korea that boosted safe haven demand, although a strong dollar limited overall gains.

The yellow metal has struggled recently, with rising geopolitical concerns countered by uncertainty over U.S. interest rates, leading traders to favor the dollar and Treasuries.

In Syria, demand for gold increased significantly following the takeover of the capital, Damascus, by rebel forces, which ousted President Bashar al-Assad, who has since fled to Russia. Markets are closely watching the implications of this regime change after a prolonged civil war, particularly with the rebels partially backed by Turkey and aligned with the Sunni Islamic sect, putting them at odds with Iran. Reports also indicated that Israel had entered Syrian territory.

Meanwhile, South Korea faced a deepening leadership crisis over the weekend, as prosecutors included President Yoon Suk Yeol in a criminal investigation linked to a failed attempt to impose martial law. Yoon narrowly survived an impeachment vote, but members of his own party suggested he may soon be sidelined.

These geopolitical developments spurred some demand for gold as a safe haven. However, gains were tempered by the dollar’s strength, which firmed ahead of key inflation data set for release this week. Markets largely anticipate that the Federal Reserve will cut interest rates by 25 basis points next week, but uncertainty about the central bank’s long-term rate outlook remains, with persistent inflation and economic resilience likely leading to a slower pace of easing into 2025.