New Record on the horizon, What’s Driving Gold’s Sharp Rise?
Gold rose to a near-record high on Monday as an escalating conflict between Israel and Iran pushed investors toward the safe-haven asset.
The precious metal rose as much as 0.6% on Monday morning in Asia to trade around $3,450 an ounce, about $50 shy of its all-time peak set in April. The two countries traded barrages of missiles and drones over the weekend, with the hostilities pushing up energy prices due to threats to energy and transportation infrastructure in the region.
The sudden surge in geopolitical risk has added more fuel to a rally that has been driven largely by the threat to global economic growth from President Donald Trump’s aggressive tariff agenda. Gold has rallied more than 30% by 2025, with central banks seeking to diversify away from the dollar another significant driver.
The precious metal’s 1.4% gain on Friday came after two days of gains as weak U.S. inflation and jobs data fueled bets that the Federal Reserve will cut interest rates later this year. Lower interest rates tend to benefit bullion because it doesn’t pay interest.
Spot gold rose 0.4% to $3,446.77 an ounce as of 7:10 a.m. in Singapore. The Bloomberg Dollar Spot Index rose 0.1% after dropping 0.8% last week. Silver was steady, while platinum and palladium gained.
Source: Bloomberg
