Gold prices surged to a record high on Monday, driven by safe haven demand as traders monitored rising tensions in the Middle East and the tightening US election race.
Bullion increased by as much as 0.3 percent, reaching an all-time high of $2,729.30 an ounce, slightly surpassing last week's peak. This bullish sentiment also extended to silver, which is trading at its highest level since 2012.
In the UAE, 24K gold is priced at Dh330.50 per gram, with 22K, 21K, and 18K gold available for Dh306, Dh296.25, and Dh254 per gram, respectively, at the market's opening. (Check the latest gold and remittance rates in the UAE)
Markets remain focused on geopolitical risks in the Middle East, particularly as Israel deliberates its next steps regarding Iran following a Hezbollah drone explosion near Prime Minister Benjamin Netanyahu's home on Saturday. Meanwhile, US President Joe Biden and his administration are advocating for renewed cease-fire negotiations in the region, despite opposition from Israeli hard-liners against any concessions.
Traders were also repositioning portfolios ahead of the US election on Nov. 5. Polls show the contest between Donald Trump and Kamala Harris could be the closest in a generation. Investors typically seek safety in gold in times of geopolitical and economic uncertainty.
Gold to hit $3,000 in 2025
Gold futures may rise to average $3,000 an ounce in the fourth quarter of 2025, Commonwealth Bank of Australia analyst Vivek Dhar said in a note on Monday. The Federal Reserve's rate-cutting cycle would likely drive weakness in the US dollar, he added. A lower greenback makes bullion cheaper for many buyers, as it's priced in the US currency.
Bullion is one of 2024's strongest performing commodities, with gains of more than 30 per cent so far this year. Rate-cut optimism fueled the most recent advances as the Fed kicked off its easing cycle last month. Robust central bank buying has also been a long-standing pillar of support for gold prices.
Spot gold was up 0.2 per cent to $2,727.15 an ounce as of 9:57 a.m. in Singapore. The Bloomberg Dollar Spot Index held a decline. Silver, palladium and platinum all rose.
