Gold prices break $2,700 level for the first time as uncertainty looms

The yellow metal is expected to trade within the range of $2,500-$2,800 in the coming months amid high levels of geopolitical tension

By Reuters

Published: Fri 18 Oct 2024, 8:20 AM

Last updated: Fri 18 Oct 2024, 11:10 AM

Gold breached the $2,700-per-ounce level on Friday for the first time ever, as US election jitters and simmering Middle East tensions boosted safe-haven demand, while a looser monetary policy environment also added fuel to the rally.

Spot gold firmed 0.5 per cent to $2,706.76 per ounce by at 6.20am, UAE time, (0220 GMT), adding nearly two per cent so far in the week. US gold futures rose 0.5 per cent to $2,722.

[Editor's Note: For real-time gold rates, click on the widget below or visit KT's dedicated Trading News page here.]

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"Gold has scoffed at a surging dollar and rallies at every chance it gets. It's just a bull market that shows no signs of exhaustion," said Tai Wong, a New York-based independent metals trader.

US economic data released overnight pointed to a strengthening economy, which boosted the US dollar and Treasury yields. But traders still see a 90 per cent chance of a Federal Reserve rate cut in November.

The European Central Bank cut interest rates for the third time this year as the euro zone economy sags.

Gold is expected to trade within the range of $2,500-$2,800 in the coming months, as prices receive support from Fed's rate cuts and high levels of geopolitical tension, BMI analysts said.

Hezbollah said it will escalate war with Israel after the killing of Hamas leader Yahya Sinwar.

Elsewhere, with less than three weeks remaining to cast votes this US presidential election, Democratic vice-president Kamala Harris and Republican former president Donald Trump are stretching for the support of every last voter.

Lower rates increase the non-yielding bullion's appeal, which is considered a safe investment during times of turmoil.

Spot silver rose 0.5 per cent to $31.92 per ounce and was headed for a weekly gain. Platinum added 0.5 per cent to $996.85 and palladium increased 0.7 per cent to $1,049.25.

Elsewhere, data showed that top metals consumer China's economy expanded 4.6 per cent in the third quarter from a year earlier, slightly beating analysts' expectations.

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