Gold broke records again as tensions in the Middle East escalated, driving investors to seek safe haven assets. Bullion soared to $2,400.67, with silver also hitting highs not seen since February 2021.
The Wall Street Journal reported that Israel is on high alert for a potential attack from Iran in response to a recent strike on the country’s diplomatic compound in Syria. This news further fueled gold’s rally as investors turned to the precious metal as a hedge against geopolitical risks and US inflation concerns.
Central banks, including China’s, have increased their purchases of gold, pushing prices higher. The ongoing turmoil in the Middle East and Ukraine has added to the metal’s appeal, along with speculation about potential rate cuts from the Federal Reserve.
In London, spot gold was up 1% to $2,396.11 an ounce, on track for its fourth consecutive weekly gain. Silver also surged to $29.2295 an ounce. However, both metals are showing signs of being overbought, with their 14-day relative strength indexes well above 70.
Platinum and palladium also saw gains despite the Bloomberg Dollar Spot Index trading near its highest level since November. A stronger US dollar typically weighs on commodity prices, but the current geopolitical tensions have outweighed this factor.
As investors continue to navigate the uncertain global landscape, gold remains a go-to asset for many seeking refuge from the turmoil in the Middle East and beyond.
