The escalation of conflict in the Middle East and possibility of the US economy slowing down pushed the gold price over $3,030 an ounce.
On Tuesday, Israel ended two-months ceasefire by launching airstrikes across Gaza, resulting in the death of more than 400 people, according to Hamas officers. The gold rose as much as 1.3% during that market session.
As for the situation in the US economy, traders estimated that the interest rate may be cut three times this year due the impact from President Donald Trump’s tariff measures. Still, they will wait for the conclusion of the Federal Open Market Committee meeting that ends today.
Besides the US economy, the world economy also highlights gold ’s role as a store of value during high uncertainties. Its price this year already went up more than 15%. Several banks has also been increasing its price target these recent weeks
The investing of physically-backed gold exchange-traded funds (ETF) has been continuing for five days straight as of Monday. According to Bloomberg, gold’s ETFs rose 5% this year after four years of dropping.
Vasu Menon, managing director of investment strategy at Oversea-Chinese Banking Corp, stated that despite the gold price managing to marginally break the short term resistance level at $3,000, the current level is not considered a strong base.
Gold prices briefly surpassed $3,040 level on Wednesday before edging down to $3,020 per ounce.
