Gold prices surged past the $2,700-per-ounce mark for the first time on Friday, as escalating tensions in the Middle East and ongoing global economic uncertainty drove demand for the precious metal.
By Friday evening in New York, gold had risen 0.8% on the day to reach $2,713.70, marking a weekly gain of 2.1%. So far this year, gold has soared nearly 32%, making it one of the top-performing commodities of 2024.
The jump in gold prices comes as investors seek a safe haven amid geopolitical instability and a series of interest rate cuts by major central banks. Gold, which offers no interest payments, tends to rise in value when interest rates fall, as it becomes a more attractive store of value.
Gold demand remains strong despite market trends
Philip Newman, managing director of Metals Focus, noted that some of the recent strength in gold prices may seem counter-intuitive, given that the European Central Bank’s (ECB) interest rate cut typically boosts the US dollar, which can weaken gold. However, the safe-haven appeal of gold, along with continued investment inflows, is keeping demand high.
“Investment inflows are meaningful,” Newman said, adding that the upcoming US presidential election and heightened geopolitical concerns are further fuelling gold’s rise.
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