On Friday, gold prices surged to new record highs on a sluggish dollar and anticipation of the US Federal Reserve (Fed) beginning to cut interest rates in September.
In the Asian afternoon session, the yellow metal futures for December delivery rose by 0.47% to $2,528.60 per troy ounce.
Furthermore, factors driving gold prices bullish are the uncertainty looming in the November US presidential election, the aggressive Middle East, and the extended Ukraine-Russia dispute.
The geopolitical and economic skepticism also adds to gold sentiment as a safe-haven asset.
According to reports, international bullion prices have surged by more than 20.00% since the start of 2024, with predictions that gold could rise to $2,700.00 levels by year-end. Some experts forecast that the yellow metal could reach $3,000.00 by mid-next year.
Additionally, as the international price of precious metal climbs, its domestic market costs have risen, with a 26.00% increase in 2024.
Due to their solid performance, the recent gold price rally sparks investors to gold-related exchange-traded funds (ETFs).
Reports show Korea Investment Management’s physical yellow metal ETF gained a 0.74% yield in July, with investments totaling ₩41.50 billion ($31.00 million).
Furthermore, Samsung Asset Management’s gold futures ETF returned 3.71% during the same period, drawing investments of 6.10 billion won.
Geopolitical Tensions Boost Gold Ahead of Powell’s Speech
Gold prices recovered some losses as the geopolitical dispute continued ahead of Fed Chair Jerome Powell’s speech later.
Moreover, traders await Powell’s talk for cues over interest rate reduction, which should provide new stimulus.
In addition, the progress of Israel-Hamas ceasefire negotiations is expected to significantly influence the short-term direction of bullion prices. The currency pair seems poised to register modest weekly losses.
Meanwhile, following an extended phase of de-stocking, analysts anticipate a substantial recovery in the physically backed gold ETF market. This market has historically been a critical driver of gold bull markets.
