Time to invest in gold again? Analysts suggest so! The price of the yellow metal is predicted to hit a record high in the coming days as demand for the safe haven surges amid concerns over rising geopolitical tensions between Iran and Israel.
On Tuesday, gold prices edged higher and were hovering around the life high hit last week.
Spot gold was up 0.1 per cent at $2,385.35 per ounce, as of 0611 GMT, after hitting an all-time high of $2,431.29 on Friday. US gold futures rose 0.8 per cent at $2,401.90.
Gold prices rose 1.6 per cent in the previous session despite data showing US retail sales increased more than expected in March.
On Multi Commodity Exchange (MCX) India, gold futures maturing on June 5, 2024, was at Rs 72,571 per 10 grams at 16:15 (IST), up 0.41 per cent from the previous day’s close of Rs 72,277.
In the retail market in India, 10 grams of 22 karat gold was selling at Rs 67,950 up by Rs 900 from Monday’s closing levels. Meanwhile, 10 grams of 24 karat gold was being sold at Rs 74,130, up Rs 980 from previously recorded levels.
Gold prices, which had been on the rise owing to central banks’ purchases and speculation around inflation data, got a fillip from the latest developments in the West Asia.
“Gold is behaving like an inflationary hedge once more,” City Index senior analyst Matt Simpson said.
How Iran-Israel conflict is pushing gold prices up?
Whenever there is a conflict or war, there is a turmoil in the market. Typically, in a scenario of high uncertainty or volatility, investors look for a “safe haven” investment. Gold has traditionally been that safe investment choice.
For the unversed, gold as an asset class mostly tends to see upward movement and do well during crisis.
Also, over time, the safe-haven metal has proven to be an effective hedge against inflation, making it an important investment option for investors.
“Gold prices rose as investors closely monitored developments associated with the conflict in the Middle East, causing safe-haven purchases of assets like bullion,” said Nippon India Mutual Fund in a statement.
“Gold prices increased on Monday as risk sentiment dampened following Iran’s retaliatory attack on Israel, sparking fears of a broader regional conflict, leaving traders apprehensive,” Geojit Financial Services said in a report.
With inputs from agencies
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Gold is headed Up, Up, Up in short, medium & long term, say experts
