Gold price surged beyond $2,700 an ounce for the first time, driven by growing concerns over escalating Middle East conflicts and the increasingly unpredictable US election. Investors sought refuge in the precious metal as global instability intensified.
Bullion climbed by as much as 0.7% to reach $2,711.99 per ounce, breaking the previous record set the day before. The rise was fueled by news that Israel had killed Hamas leader Yahya Sinwar, the architect of an attack on southern Israel that triggered an ongoing conflict in Gaza.
Prime Minister Benjamin Netanyahu vowed to continue the fight until all hostages seized by Hamas were freed, while US President Joe Biden called for an end to the war. Gold often gains in value when geopolitical tensions heighten, as investors gravitate toward safer assets.
Another factor driving the rise in gold price was the upcoming US election. Investors repositioned their portfolios ahead of the November 5 election, with FX strategist Christopher Wong of Oversea-Chinese Banking Corp noting, “Traditional polls and decentralised betting polls have diverged significantly, even as we get closer to elections. Trump hedges — long gold — may still gather traction given the fluidity of election developments and geopolitical uncertainties.”
Meanwhile, the Bloomberg Dollar Spot Index fell 0.1%, halting a four-day rally, which made bullion cheaper for international buyers. Wong added that the dollar’s rally appeared overstretched, suggesting a possible near-term pullback.
Gold has risen about 2% this week, driven by haven demand despite a US economic report that showed stronger-than-expected retail sales and jobless claims that beat forecasts. While a high-interest-rate environment typically weighs on gold, the metal remains one of 2024’s top-performing commodities with over 30% gains.
The Federal Reserve’s recent rate-cut optimism and robust central bank buying continue to support gold’s strength. Western investors have also re-entered the market, following a strong surge in demand from Asia earlier in the year. Exchange-traded funds backed by bullion are on track for a fifth consecutive month of inflows, marking the longest stretch of increases since 2020.
With growing confidence in the market, traders, refiners, and miners who attended the London Bullion Market Association’s annual meeting forecast that gold could rise to $2,917 per ounce by late October 2025, according to a survey of attendees.
As of 11 a.m. in Singapore, spot gold traded at $2,708.71 per ounce, with silver, palladium, and platinum also seeing gains.
