Gold prices top $2,700 for the first time, extending their record run

The price of the precious metal rose as much as 1% to $2,720.17 an ounce, surpassing the all-time high reached in the previous session. The bullish sentiment spread across the precious metals complex, with silver rising as much as 5.5% to its highest level since 2012. BlackRock Inc.’s iShares Silver Trust, the largest exchange-traded product tracking the metal, saw a sharp increase in call options as investors bet on higher prices.

Markets are focusing on increasingly tense geopolitical developments after Israel said it had killed Hamas leader Yahya Sinwar, the architect of the Palestinian group’s attack on southern Israel that sparked a year-long war in Gaza.

Prime Minister Benjamin Netanyahu said Israel would continue fighting until all the hostages held by Hamas last year were free, even as US President Joe Biden said it was time for an end to the war. In times of geopolitical and economic uncertainty, investors typically seek safety in gold.

Investors also restructured their portfolios in the run-up to the US elections on November 5th.

“Traditional polls and decentralized betting polls diverge significantly even as we approach the election,” said Christopher Wong, foreign exchange strategist at Oversea-Chinese Banking Corp. “Trump hedges – long gold – could still become more important given fluid election developments and geopolitical uncertainties.”

Meanwhile, the Bloomberg Dollar Spot Index fell 0.2%, ending a four-day rally. A weaker dollar makes gold bullion cheaper for many buyers because it is priced in U.S. currency.

Gold prices are up about 2.4% this week, with safe-haven demand outweighing other macro headwinds that would normally weigh on the precious metal, after U.S. reports on Thursday reduced bets on the extent of the Federal Reserve’s easing measures.

Gold bullion is one of the best performing commodities in 2024, with gains of more than 30% so far this year. Rate cut optimism drove recent gains as the Fed began its easing cycle last month. The robust purchases by central banks have also long supported the price of gold.

Read more: Gold investors see gains in era of rate cuts through ETFs and safe-haven buying

Western investors also helped push prices higher after largely holding back in the first half of the year as Asian demand surged. The Federal Reserve’s shift toward looser monetary policy has increased the appeal of exchange-traded funds backed by gold bullion, with holdings on track for a fifth monthly expansion in October – the longest streak of inflows since 2020.

For many in the industry, the outlook from here is even more optimistic. Traders, refiners and miners attending the London Bullion Market Association’s annual meeting this week saw prices rising to about $2,917 an ounce by the end of October 2025, according to the average forecast in a delegate poll. According to the survey, silver will rise more than 40% to $45 an ounce next year.

Spot gold was trading at $2,718.72 an ounce as of 2:36 p.m. in New York. Both palladium and platinum rose.