Gold soared to an all-time high on Tuesday afternoon, continuing its upward momentum for the fifth consecutive day. The precious metal’s latest rally follows a significant U.S. interest rate cut last week, combined with escalating violence in the Middle East, which has deepened investor anxiety.
Gold futures for December delivery climbed by $24.80, settling at $2,677.30 per ounce—breaking the previous record of $2,652.50 set just a day earlier on Monday.
The ongoing surge in gold prices has been largely driven by last Wednesday’s decision by the Federal Reserve to lower U.S. interest rates by 50 basis points. The Fed also signaled that another rate cut of similar magnitude could be expected before the end of the year. Lower interest rates make non-interest-bearing assets like gold more attractive, as they reduce the opportunity cost of holding the precious metal.
Furthermore, rising geopolitical tensions have reinforced gold’s status as a safe-haven asset. The intensifying conflict between Israel and Hezbollah has added another layer of uncertainty. After Israeli airstrikes in Lebanon on Monday, which claimed 558 lives and left hundreds injured, Israeli forces launched further strikes on Beirut on Tuesday, while Hezbollah responded by firing missiles into northern Israel.
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Meanwhile, the U.S. dollar softened slightly, with the ICE dollar index slipping by 0.3 points to 100.55. U.S. Treasury yields also declined, with the two-year bond yield falling by 0.2 basis points to 3.593%, and the 10-year bond yield decreasing by 0.1 basis points to 3.749%.
With global tensions high and market dynamics shifting, many traders are turning to gold as a reliable hedge. Now might be the perfect time to explore trading opportunities and benefit from market volatility.