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Gold hit a new all-time peak of $2,141.79 per ounce on Tuesday.
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The price of the precious metal has been rising, driven by rate-cut hopes and safe haven trades.
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In the last year, central bank buying and recent Chinese demand has also kept prices elevated.
Gold surged to a new record on Tuesday, as geopolitical tensions and interest rate speculation drove a rally in the yellow metal.
The commodity rose to as high $2,141.79 per ounce, eclipsing its December all-time high of $2,135.39, according to Bloomberg data.
“Gold has been building a base ever since it broke back above $2,000 in mid-February. Upside momentum has also been building steadily,” FCA senior analyst Dave Morrison said in a note.”While a pullback is certainly possible, it would be surprising to see gold give back all its gains from last week.”
Gold’s rise is in part due to its safe-haven status, which investors are increasingly seeking out amid ongoing international turmoil. With the Ukraine war and the Gaza Strip conflict still raging, the asset’s spot price has risen 3.2% year-to-date.
But the metal saw a much sharper increase since mid-February, and has added around $100 in the past week. The latest jump comes as investors are convinced that the Federal Reserve will cut interest rates in the coming months. As gold offers no yield, it’s more attractive to traders when bond and cash returns weaken.
According to fed funds futures, the odds of a Fed summer pivot currently stand at 55%. This week, investors will be watching Chairman Jerome Powell’s congressional testimony for more clues about the path of monetary policy.
US policy aside, the yellow metal has also benefited from strong international demand. On one hand, a global effort to move away from dollar reserves caused international central banks to buy record amounts of the commodity.
Meanwhile, gold’s upsurge in recent months was also helped by Chinese investors, who have been seeking a safe haven amid the country’s property and stock market turmoil, Bloomberg added.
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