Gold prices surged to yet another record high on Tuesday, marking the eighth consecutive session of gains fueled by momentum-driven trading and escalating geopolitical tensions.
Spot gold climbed 1.1% to reach $2,363.42 per ounce by 0936 GMT, hitting a peak of $2,365.09, as investors continued to favor the precious metal amid ongoing uncertainty in global markets.
Ole Hansen, head of commodity strategy at Saxo Bank, highlighted the strong underlying momentum driving gold prices, with traders still adopting a “buy-on-dip” strategy. Geopolitical risks stemming from the Russia-Ukraine conflict and tensions in the Middle East have further bolstered demand for gold, shifting investor focus from concerns about lower rate cut expectations to persistent inflationary pressures.
Market participants are eagerly awaiting the release of the U.S. Federal Reserve’s policy meeting minutes and U.S. inflation data scheduled for Wednesday, seeking fresh insights into the future path of U.S. interest rates. Despite traditionally being hindered by higher interest rates, gold has defied this trend in April, maintaining its upward trajectory.
Technically, spot gold prices have entered the overbought territory, as indicated by the relative strength index, signaling potential volatility in the near term.
Silver also experienced gains, rising 1.0% to $28.11 per ounce, hitting its highest level since June 2021. Analysts anticipate silver to benefit from gold’s rally, potentially surpassing the $30 mark within the next 12 months.
In a note on Tuesday, analysts at BofA projected that gold could rally to $3,000 per ounce by 2025, with silver following suit due to stronger industrial demand. Platinum and palladium also saw increases, with platinum gaining 2.3% to $980.9 and palladium rising 1.7% to $1,060.75. However, BofA forecasts palladium prices to trend lower in the longer term, underperforming platinum, as demand remains dominated by auto catalysts.
As gold continues its record-breaking streak, investors remain attuned to geopolitical developments and economic indicators for further cues on the precious metal’s trajectory in the coming sessions.