10/19/2024–|Last updated: 10/20/202411:53 AM (Mecca time)
Gold exceeded the level of $2,700 per ounce for the first time ever, continuing its gains supported by expectations of increased monetary policy easing and the demand for safe havens due to uncertainty regarding the US presidential elections and conflicts in the Middle East.
Gold rose in spot transactions at the end of Saturday’s trading by 1% to $2,720.05 per ounce, and US gold futures contracts reached $2,730 upon settlement.
Alexander Zumpfy, a trader in precious metals at the German Heraeus Metals company, said: “As the conflict worsens – especially after the Lebanese Hezbollah announced the escalation of the war with Israel – investors are turning to gold, which is one of the traditional safe assets.”
The escalation of tension in Gaza and Lebanon after the announcement of the martyrdom of the head of the Hamas political bureau, Yahya Sinwar, led investors to resort to safe assets such as gold, to avoid risk and due to fears of global market instability.
“The rise in prices is reinforced by concerns about the US presidential elections and expectations of more accommodative monetary policies,” Zombfie said.
Gold exceeded its record level several times during the current year due to geopolitical tension and expectations that major central banks would continue monetary easing, which led to prices rising by more than 30% since the beginning of the year in the best annual growth since 1979, according to data from the London Stock Exchange Group.
Low interest rates enhance the attractiveness of owning non-yielding gold.
Sources told Reuters that the European Central Bank is likely to cut interest rates again next December unless economic data prompts it not to do so.
Investors see a very high chance that the Federal Reserve (the US central bank) will cut interest rates next November.
As for other precious metals, silver rose in spot transactions by 6% to $33.58 per ounce, platinum increased by 2.4% to $1,016.25, and palladium rose by about 4% to $1,083.25.
