Key points:
Spot gold increased by 0.6% to $2,735.14 per ounce by 0658 GMT, while US gold futures were up 0.4% at $2,749.30. This rise follows Monday’s all-time high of $2,740.37.
Gold has gained more than 32% in 2024 as political and geopolitical risks dominate market sentiment. The US election, now only weeks away, along with escalated tensions in the Middle East, has kept demand for gold steady as traders turn to it for its safe-haven status.
See also: Gold at Record Highs with Election Uncertainty
A further rise in gold prices is expected, with market participants eyeing the $2,800 per ounce level.
The combination of central bank demand, geopolitical risks, and uncertainties over the outcome of the US election could sustain momentum for precious metals in the short term.
See: Gold (XAUUSD) continues its bullish trend, closing at $2,735.84, with upward momentum on the VT Markets app.
Adding to the bullish outlook, traders see an 87% probability of a 25-basis-point rate cut from the US Federal Reserve in November.
The potential easing of monetary policy has supported gold as it traditionally benefits from a lower interest rate environment.
Benchmark 10-year US Treasury yields reached a 12-week high, which reflects broader caution in the market, while the US dollar held close to a two-and-a-half-month high.
In the broader precious metals market, silver continues its rise, gaining 1.1% to $34.12 per ounce, after hitting its highest level since late 2012 in the previous session
Platinum and palladium also saw gains, with platinum rising 1% to $1,013.10 and palladium up 1.4% at $1,065.44 per ounce. These metals, often driven by supply constraints and industrial demand, remain supported by broader market trends.
We expect that gold and other precious metals could extend their gains in the near term, particularly as geopolitical risks and central bank policy decisions remain in focus.
Traders will be closely watching developments in the Middle East and any further announcements on US monetary policy.
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