Gold Rises on Weak Dollar and Geopolitical Instability

Gold prices closed higher on Friday, July 18, recording slight gains due to the decline of the US dollar and the escalation of economic and geopolitical uncertainty, which supported demand for the yellow metal as a safe haven. However, these gains did not prevent gold from registering marginal losses throughout the week, while platinum witnessed a decline after a strong rally that pushed it to its highest level in over a decade.

Spot gold rose by 0.4% to reach $3,351.18 per ounce, while US gold futures also rose by the same percentage to settle at $3,355.30. Despite this improvement, the yellow metal lost about 0.5% of its value since the beginning of the week.

Analysts believe that the weakness of the dollar, which saw its index decline by 0.3%, was a key factor in supporting gold, making it more attractive to investors outside the United States. Edward Mayer, an analyst at Marks Bank, stated that "the precious metals sector is experiencing general gains due to the decline of the US currency".

On the other hand, Suki Cooper, a precious metals analyst at Standard Chartered Bank, warned that concerns related to US debt and tariffs may keep gold in the spotlight, affirming that "this support seems strong at the moment". In a related context, Calvin Wong, chief market analyst at Oanda, pointed out that market participants are still cautious amid strong US economic indicators, expecting the Federal Reserve not to move towards a more flexible monetary policy soon.

In other metal markets, platinum fell by 2% to $1,428.65 per ounce after reaching its highest level since August 2014. David Wilson, chief commodity strategist at BNP Paribas Markets 360, speculates that demand for platinum from China and the jewelry sector may decline in the third quarter of the year, which could increase pressure on its prices. Palladium dropped by 1.6% to $1,259.09, while silver rose by 0.3% to $38.23 per ounce.