Gold broke a fresh record high on Monday as investors sought shelter amid Middle East uncertainty and turned their attention to leading emerging-market economies, that may unveil gold-backed currency this week.
Gold holds above $2,700
Spot gold jumped to $2,735.36 an ounce on Monday from $2,711.60 on Friday. Silver was up at $34.05 an ounce from $32.14.
The yellow metal hit an intraday high of USD2,737 an ounce, the highest level ever. Bullion, which has rallied 33% so far this year, broke above USD2,700 for the first time on Friday.
Safe-haven assets, including gold, are in demand as conflict continues to "wrack" the Middle East and concerns persist about a slowdown in global growth, Hargreaves Lansdown analyst Susannah Streeter said.
"More investors have been piling into gold, with the precious metal reaching fresh record highs," Streeter said.
Israel began bombing Lebanese branches of an association accused of financing the Iran-backed Hezbollah movement, Lebanese state media reported late Sunday. US Secretary of State Antony Blinken heads back to the Middle East Monday on a new push for an elusive Gaza ceasefire two weeks before US elections, AFP reports.
"Israel's continuing bombardment of Lebanon and Gaza is adding to the risk of overspill into wider conflict in the region," Hargreaves Lansdown's Streeter said, adding: "The uncertain outcome of the US presidential election is also likely to be playing on minds and leading to more defensive positioning."
Republican Donald Trump will face Democrat Kamala Harris in the US presidential election on November 5.
Brics to talk about gold
Scope Markets analyst Joshua Mahony also said gold found itself at a fresh high once again, with this week looking set to be dominated by talk of a gold-backed Brics currency. Brics is a block that includes Brail, Russia, India, China and South Africa.
"Between them, the Brics nations have been dramatically stockpiling gold over recent years, with Russia and China now holding roughly 16% of global reserves," Mahony said.
"While efforts to move away from dollar reliance has thus far been questionable, the comments coming from this week's Brics summit could yet shine a light on gold as a key asset for these major economies," he said.
