Gold prices are poised to achieve gains for the third consecutive week today, Friday, as the conflict in the Middle East drives increased investor demand for safe havens, despite the prospect of high U.S. interest rates remaining for an extended period. As of 03:41 GMT, spot gold rose by 0.1% to $1986.76 per ounce, while U.S. gold futures remained relatively unchanged at $1996.80.
Kyle Rodda, a market analyst at Capital.com, stated, "Gold prices will be influenced by the conflict between Israel and Hamas as long as tensions are at risk of escalation." Gold has risen nearly nine percent as investors turn to it as a safe haven amidst the potential repercussions of the conflict between Israel and the Palestinians, which escalated earlier this month. However, prevailing expectations of rising U.S. interest rates have kept gold prices below the $2,000 threshold, last surpassed in May.
Rodda further commented, "Gold is holding firm due to geopolitical risks, with prices diverging from traditional fundamental drivers. If it were based on Treasury yields and the dollar, gold would be lower." The dollar is on track for weekly gains today, while U.S. Treasury yields rose by 0.2% after data showed U.S. economic growth accelerated at its fastest pace in nearly two years in the third quarter. U.S. Treasury Secretary Janet Yellen noted that nearly five percent economic growth in the third quarter is a good sign that the economy is heading toward a soft landing, but it may contribute to keeping long-term Treasury yields elevated.
Investors are also focused on the U.S. Personal Consumption Expenditures Price Index data due to be released later today for hints on what to expect from the upcoming Federal Reserve policy meeting next week. Regarding other precious metals, silver remained stable in spot transactions at $22.84 per ounce. Platinum rose by 0.5% to $904.71, while palladium increased by 0.2% to $1135.65.
