Gold Surpasses $5000 an Ounce... Why Is It Jumping So Strongly?
Gold continued its crazy rise today, Wednesday, recording gains of over 2% to reach $5044.74 an ounce in spot transactions, following its previous record jump.
U.S. gold futures rose by 2.7% to $5067 an ounce, with investors expecting at least two interest rate cuts by the U.S. in 2026.
This increase is attributed to a surge in buying for bargain hunting, alongside a decline in the dollar against most major currencies, which enhanced gold's appeal as a safe haven.
In a related context, gold recorded its best daily performance since 2008 after its previous jump of 5.9% on Tuesday, while it reached its highest record level at $5594.82 last Thursday.
Other precious metals also saw significant increases, with silver rising 3.2% to $87.84 an ounce after reaching $121.64 in a record last week, platinum up 2.3% to $2260.50, and palladium climbing 3% to $1782.85 an ounce.
The geopolitical tension between the United States and Iran adds further momentum to the precious metal, after the U.S. military shot down an Iranian drone that approached "aggressively" near the aircraft carrier Abraham Lincoln in the Arabian Sea.
Meanwhile, nuclear talks between the two countries are expected to take place in Oman on Friday.
On the economic front, U.S. President Donald Trump signed a spending agreement that ends the partial government shutdown, while investors await private job data from ADP for indicators on future Federal Reserve policy.
A decline in interest rates enhances the appeal of gold, which does not yield returns.
