Gold hits near 2-month high as Middle East conflict boosts safe-haven demand
Spot gold was little changed at $3,428.89 an ounce, as of 0508 GMT, after hitting its highest level since April 22 earlier in the session
Highlights:
- Israel-Iran battle escalates
- Fed policy decision due on Wednesday
- Palladium up more than 1%
Gold rose to a near two-month high on Monday, as intensified clashes between Israel and Iran over the weekend stoked fears of a broader regional conflict, pushing investors towards safe-haven assets.
Spot gold was little changed at $3,428.89 an ounce, as of 0508 GMT, after hitting its highest level since April 22 earlier in the session.
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US gold futures were down 0.1% to $3,448.10.
"It's the joint political risk premium that's rising due to the Iran-Israel conflict at this point that has boosted safe-haven demand for gold," said Kelvin Wong, a senior market analyst, Asia Pacific at OANDA.
"We have a clear break above $3,400 right now and the short term uptrend is intact. We are seeing resistance level at $3,500 and with the possibility of breaking new high above the $3,500 level."
Israel and Iran launched fresh attacks on Sunday, killing and wounding civilians and raising concerns of a broader regional conflict, with both militaries urging civilians on the opposing side to take precautions against further strikes.
US President Donald Trump said he hopes Israel and Iran can broker a deal but said sometimes countries have to fight it out first.
Gold is considered a safe-haven asset during times of geopolitical and economic uncertainty.
Investors this week will look forward to a host of central bank monetary policy decisions, with the spotlight on the US Federal Reserve on Wednesday.
The US central bank is widely anticipated to keep interest rates steady, with markets awaiting signals on potential rate cuts in the months ahead.
Futures markets suggest expectations for two rate cuts by year-end, possibly starting in September, bolstered by tame inflation data last week.
Elsewhere, spot silver eased 0.1% to $36.28 per ounce, platinum rose 0.4% to $1,233.12, while palladium gained 1.4% to $1,041.85.
