Gold hit a more than two-week high on Thursday, fuelled by safe-haven buying, while the market took out positions ahead of the Federal Reserve’s rate outlook and the potential impact of President-elect Donald Trump’s proposed trade tariffs.
Spot gold rose 1.2% to $2,654.24 an ounce by 02:57 p.m. EST (1957 GMT), hitting its highest since Dec. 16. U.S. gold futures settled 1.1% higher at $2,669.
A line chart titled “Spot gold price in USD per oz” that tracks the metric over time.
“I can’t see anything market-moving in the news, but geopolitical forces (international tensions as well as financial uncertainties, not less ahead of the inauguration of President-elect Trump) are supportive,” said StoneX analyst Rhona O’Connell in an email.
Bullion thrives in low-interest-rate environments and acts as a hedge against economic and geopolitical risks.
Russia launched a drone strike on Kyiv early on Wednesday, causing damage in at least two districts, while the Israeli military struck a suburb of Gaza City.
Traders await next week’s U.S. job openings data, the ADP employment report, the Fed’s December FOMC meeting minutes and the U.S. employment report to gauge the interest-rate outlook for 2025.
In 2024, rate cuts, central-bank buying and geopolitical tensions drove gold to record highs with an over 27% annual gain, its biggest since 2010.
“Corrections or consolidations in the early part of the year could set the stage for a renewed rally,” Fawad Razaqzada, market analyst at Forex.com said, adding that a gold-price target of $3,000 an ounce was feasible.
“The unwinding of the ‘Trump trade’ – a phenomenon characterised by a strong U.S. dollar and robust equity markets – could weaken the dollar and bolster gold prices.”
Trump’s inauguration on Jan. 20 has heightened uncertainty, with his proposed tariffs and protectionist policies expected to be inflationary and potentially spark trade wars.
Among other metals, spot silver rose 1.9% to $29.43 an ounce, palladium was steady at $910.64 and platinum climbed 1.9% at $920.72.
By Sherin Elizabeth Varghese and Anjana Anil
