Gold prices continue to climb, holding near record highs as uncertainty surrounding the upcoming US election and geopolitical tensions in the Middle East fuel strong demand for the precious metal.
With ongoing market volatility and the potential for interest rate cuts from the Federal Reserve, gold remains a preferred safe-haven asset for investors. Other precious metals are also performing well, further underscoring the bullish sentiment in the commodities market.
Gold holds near record high
Spot gold remained steady at USD 2,694.99 per ounce as of Friday morning, holding its ground after setting a new record high of USD 2,696.59 the day before.
The precious metal has climbed over 1% this week, driven by strong demand amidst uncertainty surrounding the US election and ongoing tensions in the Middle East.
US gold futures also edged up 0.1% to USD 2,710.20 per ounce, reinforcing the current upward momentum in gold.
Gold is showing a bullish trend with upward momentum but it faces short-term resistance around 2714 on the VT Markets app.
Gold gains as US election tensions and geopolitical risks mount
As the US presidential election draws nearer, Vice President Kamala Harris and former President Donald Trump are intensifying their efforts to secure voter support.
This heated political climate is a major contributor to the recent surge in gold prices, as investors tend to flock to safe-haven assets like gold during periods of uncertainty.
Harris holds steady, marginal 45%-42% lead over Trump, Reuters/Ipsos poll finds
The political situation has been further complicated by the killing of Hamas leader Yahya Sinwar by Israeli forces, which could escalate conflict in the Middle East.
This geopolitical turmoil is another driver of gold’s appeal as a safe-haven investment.
Although US economic data remains strong, signalling a resilient economy, the Federal Reserve is still expected to cut interest rates in November.
The CME FedWatch tool indicates an 88% chance of a rate cut. Lower interest rates generally benefit gold, as it does not offer interest returns, prompting more traders to seek it as a hedge.
Swiss gold exports drop, but gold’s bullish run continues
On the physical side, Swiss gold exports declined in September, hitting their lowest point since June.
This drop, particularly in shipments to India, indicates some softness in physical demand. However, this has not been enough to halt the broader bullish trend in gold prices.
Other precious metals are also performing well, with spot silver gaining 0.2% to reach USD 31.76 per ounce and platinum holding steady at USD 991.60 per ounce, both on track for weekly gains.
In contrast, palladium dipped slightly, down 0.1% to USD 1,040.75 per ounce.
Gold’s proximity to its record high reflects growing investor concerns over global instability.
If geopolitical tensions persist and central banks continue to ease monetary policy, there is potential for gold prices to rise further in the coming weeks.
However, shifts in the political or economic landscape could bring volatility to the market.
