(MENAFN) On Friday, the price of gold soared to an unprecedented level, surpassing USD2,400 per ounce amidst a worldwide rush for safe-haven assets. Spot gold prices experienced a remarkable 2.4 percent increase, reaching a historic high of USD2,431.52 per ounce before slightly retracing gains. This surge marked a 4 percent increase for the week and an impressive 16 percent rise year-to-date, surpassing the 13 percent advance recorded for the entire 2023.
Market analysts attribute this remarkable rally to heightened investor demand for safe-haven assets amid escalating global uncertainty and geopolitical tensions, particularly in the Middle East. United States officials warned of potential significant strikes by Iran on Israel within the next 24 to 48 hours, following recent airstrikes that killed two senior Iranian generals, further exacerbating geopolitical tensions in the region.
Chris Gaffney, president of world markets at EverBank, emphasized the predominant positive factors driving gold's surge, with heightened Middle East tensions being the primary catalyst.
Similarly, Rhona O’Connell, head of market analysis at StoneX Financial Ltd., highlighted geopolitical risk as the driving force behind the surge, especially amidst a year marked by over 50 local and national elections, which further fuel uncertainty.
Additionally, experts noted that robust buying from China has contributed to bolstering gold prices further. Traditionally, investors turn to gold during times of market volatility and uncertainty to hedge risks and preserve wealth. Gold has historically served as a safe haven asset during economic instability, stock market downturns, geopolitical conflicts, and health crises, offering investors a reliable store of value for millennia.
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