Gold prices continued their record ascent on Monday, propelled by speculative activities and ongoing tensions in the Middle East, overshadowing strong U.S. job data released last week.
The spot price of gold rose 0.3% to $2,335.73 per ounce by 0646 GMT, after reaching a record high of $2,353.79 earlier in the session. U.S. gold futures also climbed 0.4% to $2,354.50.
Kyle Rodda, a financial market analyst at Capital.com, remarked, “Looking at futures pricing, there are now indicators of momentum in the market… to the extent that we’re seeing a bit of over-optimism regarding gold’s prospects at the current level.”
Strong purchases by central banks, the appeal of safe-haven assets amid escalating geopolitical risks, and demand from trend-following funds have propelled gold prices up by 12% since the beginning of the year.
Meanwhile, U.S. job growth exceeded expectations in March, indicating a strong end to the first quarter for the American economy and possibly delaying the Federal Reserve’s anticipated interest rate cuts this year.
UBS has raised its year-end gold price target to $2,250 per ounce in light of strong demand and increased purchases by exchange-traded funds (ETFs).
UBS noted, “We expect ETFs to increase their gold holdings once the Federal Reserve begins cutting interest rates around mid-year.”
In India, gold demand remained tepid last week due to buyers holding off on purchases because of sharply higher local prices, while prices in China, the largest consumer of gold, remained steady.
Other precious metals also saw increases; silver in spot transactions rose 1.1% to $27.77 per ounce, platinum increased by 0.1% to $927.78 per ounce, and palladium went up by 0.2% to $1,001.76 per ounce.
