Gold price gains on Thursday, supported by a weakness of U.S. dollar and ongoing geopolitical turmoil. Spot gold increased by 0.5%, reaching $2,626.10 per ounce in early trading. U.S. gold futures also saw a gain, rising 0.3% to $2,643.70. This trend is significant as gold is often considered a safe-haven asset during uncertain times.
The dollar index dropped by 0.1%, making dollar-denominated gold more affordable for international buyers. Market experts highlighted that this inaction in the U.S. dollar and Treasury yields allowed gold prices to recover after a dip following Federal Reserve decisions.
Geopolitical tensions in the Middle East are also influencing gold prices. Despite some progress in ceasefire discussions, uncertainty remains between Hamas and Israel. Market analysts suggest that any escalation could create upward pressure on gold prices. This aligns with gold's role as a preferred investment during geopolitical crises.
Moreover, investors are closely monitoring the Federal Reserve's 2025 interest rate strategy and anticipated policy shifts under Trump's administration. Changes in tariffs, deregulation, and taxes could further impact gold's trajectory in the coming year.
The year-end holiday season has reduced trading volumes, yet gold remains on track for its best annual performance since 2010. The metal has surged by 27% this year, driven by significant rate cuts and increased geopolitical uncertainties. Analysts also note a historical pattern of gold performing well in the last week of December.
While gold takes the spotlight, other metals showed mixed performance. Spot silver held steady at $29.6 per ounce, platinum declined 0.8% to $936.41, and palladium dropped 1.2% to $942.52. These movements reflect broader trends in the precious metals market as the year ends.
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Gold gains on a weakness of dollar and geopolitical tensions. Learn how Fed policies and Middle East turmoil influence gold prices.
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