(Bloomberg) — Gold rallied to a record and silver hit the highest in more than three years as Israel prepared for a possible strike by Iran, aiding haven demand, and traders weighed the outlook for US monetary policy.
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Bullion climbed as much as 1% to $2,395.48, while silver traded at the highest since February 2021. Israel is preparing for an assault in the next two days, in retaliation for its strike on Iran’s diplomatic compound in Syria last week, the Wall Street Journal reported, citing a person familiar with the matter.
Gold has powered higher this year, dragging silver along with it, as central banks including China’s stepped up purchases of the costlier metal, while heightened geopolitical risks in the Middle East and Ukraine also supported consumption. In addition, traders have also been assessing the scope for rate cuts from the Federal Reserve over 2024, although recent, still-strong inflation prints from the top economy have muddied that outlook.
Spot gold was 0.7% higher at $2,388.69 an ounce at 2:33 p.m. in Singapore, with the metal on pace for a fourth weekly advance, the best run since early 2023. Silver rallied to as much as $29.0030 an ounce. Still, both metals’ 14-day relative-strength indexes are well above 70, beyond the level that some investors see as overbought, potentially heralding a pause.
Platinum and palladium also advanced even as the Bloomberg Dollar Spot Index traded near the highest level since November. A stronger US currency is typically a headwind for commodities prices in the greenback as its can dull interest from overseas buyers.
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Source: Gold Hits Record and Silver Surges as Mideast Risks Stoke Demand
