Gold hit a new all-time high for the sixth consecutive session early Thursday, nearing the $2,700 mark due to falling interest rates, anticipated physical demand from India, and the looming threat of escalating conflict in the Middle East. December gold futures rose $11.50 to settle at $2,696.20 per ounce.
The price of the precious metal has been steadily climbing since the Federal Reserve cut interest rates by 50 basis points last week. Lower rates reduce the opportunity cost of holding gold, making it more attractive for investors. Safe-haven buying also fueled the surge amid reports that Israel is preparing to invade southern Lebanon, potentially drawing Iran into the conflict through its proxy Hezbollah militia.
Physical gold demand is expected to receive a boost from India following the country’s decision to slash import taxes on gold from 15% to 6%, just in time for the wedding and festival season, which traditionally sees high demand for gold jewelry and gifts.
“Indian gold demand is set to surge due to the reduced import tax and a lively upcoming wedding and festival season,” said Saxo Bank.
Silver prices also climbed in tandem with gold, with silver gaining $0.64 to reach $32.66 per ounce, the highest level since 2012.
The U.S. dollar dipped slightly, with the ICE Dollar Index slipping 0.04 points to 100.87.
U.S. Treasury yields showed mixed results after initial jobless claims in the U.S. rose by 218,000 last week, slightly below expectations of 223,000. The two-year Treasury yield climbed to 3.59%, up 3.3 basis points, while the 10-year yield remained unchanged at 3.788%.
Stay updated with the latest gold price updates as market fluctuations continue to drive precious metal demand and geopolitical tensions influence investor behavior.