Gold records a new historical high amid demand for safe havens

Gold prices rose to a new record high, today, Tuesday, amid renewed trade tension between the United States and China, which increased uncertainty and strengthened demand for safe havens, while expectations of a reduction in US interest rates also supported prices.

Gold increased in instant transactions by 1.31% to $4,164.23 per ounce by 04:46 GMT, after hitting a record level near $4,170 earlier in the session.

US gold futures for December delivery rose 1.02% to $4,175.20.

Gold, which is considered a safe haven, jumped 57% since the beginning of the year and exceeded the level of $4,100 for the first time yesterday, Monday, supported by geopolitical and economic concerns, expectations of lowering interest rates, central banks purchasing large quantities of the yellow metal, and flows of exchange-traded funds, according to Reuters.

Silver rose in spot transactions 0.3% to $52.49 per ounce, after recording $52.70 earlier in the day.

US Treasury Secretary Scott Besent said on Monday that President Donald Trump still intends to meet with his Chinese counterpart, Xi Jinping, in South Korea in late October.

This tension in relations came after China announced on Thursday the expansion of restrictions imposed on the export of rare earth materials, prompting Trump to threaten to impose 100% tariffs on Chinese imports and impose controls on the export of important American software starting from the first of November.

Besant noted that the ongoing federal government shutdown, now in its thirteenth day, has begun to impact the country’s economy.

Analysts at Bank of America and Société Générale expect gold to reach $5,000 by 2026, while Standard Chartered Bank raised its average forecast for 2026 to $4,488.

Investors still expect an interest rate cut of 25 basis points at the Federal Reserve meeting this month, followed by a similar cut in December.

As for other precious metals, platinum rose 0.5% to $1,653.45 per ounce, while palladium gained 1.6% to $1,498.25, recording the highest level since May 2023.