Spot Gold held near a fresh 7-week high of $3,451.52 on Monday, as escalating conflict between Israel and Iran over the weekend fueled concerns over a broader regional confrontation, triggering a rush into safe-haven assets.
Israel and Iran launched new strikes on Sunday, which led to civilian injuries and deaths, with both militaries urging civilians on the opposing side to take precautions against more attacks.
“It’s the joint political risk premium that’s rising due to the Iran-Israel conflict at this point that has boosted safe-haven demand for gold,” Kelvin Wong, senior market analyst, Asia Pacific at OANDA, was quoted as saying by Reuters.
“We have a clear break above $3,400 right now and the short term uptrend is intact. We are seeing resistance level at $3,500 and with the possibility of breaking new high above the $3,500 level.”
Market players will also be focusing on the outcome of the Federal Reserve’s two-day policy meeting this week, at which the central bank is expected to keep interest rates on hold.
Markets are now pricing in about 50 basis points of rate cuts by the Federal Reserve by year-end.
Spot Gold was last down 0.41% on the day to trade at $3,418.63 per troy ounce.
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