Gold on a record run. US$2,400 an ounce soon?

Gold prices continued their record-breaking rally, driven by buying momentum and geopolitical tensions. Spot reached a high of US$2,365.09 per ounce before settling at US$2,346.57, while US futures rose to US$2,362.4. Market analysts anticipate further gains unless US CPI data surprises with higher inflation.

Gold record

The Federal Reserve’s policy meeting minutes and US CPI data are awaited for insights into potential rate cuts. Bullion remains attractive amid inflation concerns and geopolitical risks, although higher interest rates could dampen its appeal.

Silver also saw gains, while platinum and palladium prices rose. Concerns over palladium’s underperformance relative to platinum persist due to lack of production.

The fundamentals underpinning the current rally include growing geopolitical risk, steady central bank buying and resilient demand for jewellery and bars and coins. With the prospect of lower interest rates ahead, the suggestion is that gold exchange-traded funds have missed the rally and are now under-allocated.