Gold prices edged higher on Tuesday drawing strength from rising inflation fears that has rattled financial markets, although concerns over looming U.S. Federal Reserve tapering limited gains.

Spot gold rose 0.2% to $1,757.84 per ounce by 0904 GMT, while U.S. gold futures were up 0.1% at $1,757.70.

Risk sentiment in wider financial markets was subdued, as inflation fears triggered by a global energy crunch threatened the economic outlook and drove some investors towards safe-haven assets.

“There’s more risk aversion in the market and gold is benefiting from that, coupled with concerns about inflation and cooling of the global economy,” Commerzbank analyst Daniel Briesemann said.

If stagflation talks come to the fore increasingly, that should help gold clock $1,900 by year end as interest rates should remain relatively low even if the Fed starts tapering, Briesemann added.

Gold is traditionally seen as an inflation hedge. However, reduced central bank stimulus and interest rate hikes tend to push government bond yields up, translating into a higher opportunity cost for holding gold that pays no interest.

Gold also defied gains in the benchmark U.S. Treasury yields, which hit a peak since early June. The dollar index, on the other hand, was largely steady.

Focus also remains on minutes of the Fed’s Sept. 21-22 policy meeting and the consumer price index, both due on Wednesday.

Economic data will be closely watched for the health of global economy and signs of prolonged stagflation could push gold towards $1,800, said Harshal Barot, a senior research consultant for South Asia at Metals Focus.

Spot silver rose 0.1% to $22.58 per ounce, and platinum gained 0.6% at $1,014.23.

Palladium inched 0.1% higher to $2,113.46, having hit its highest since Sept. 10 at $2,182.67 on Monday.