Gold prices surged past the historic milestone of $2,700 per ounce on Friday, driven by escalating geopolitical tensions, uncertainties surrounding the U.S. elections, and expectations of relaxed monetary policies. Key highlights include:
Price Movement: Spot gold rose 1% to $2,720.05 per ounce, while U.S. gold futures settled at $2,730, marking a 2.4% increase for the week.
Geopolitical Tensions: The intensification of conflict in the Middle East, particularly following Hezbollah’s announcement to escalate its involvement, has led investors to seek gold as a safe-haven asset.
Market Sentiment: The ongoing violence and the failure of diplomatic efforts to stabilize the situation in Gaza and Lebanon have heightened risk aversion among investors.
Monetary Policy Expectations: Anticipation of looser monetary policies from central banks, including a potential rate cut by the Federal Reserve in November, has further fueled gold’s rally. Analysts are predicting a 92% chance of this rate cut.
Future Projections: Citi’s Max Layton forecasts that gold could reach $3,000 per ounce within the next 6-12 months, driven by demand for safe-haven assets amid economic uncertainty.
Other Precious Metals: Silver rose 6% to $33.58, while platinum and palladium also saw gains.
Gold has experienced over 30% growth this year, marking its best annual performance since 1979, as investors flock to secure their wealth amid rising global instability.