Gold leaps above $1925 amid escalating geopolitical tensions

In the wake of the rising Israel-Palestine crisis, gold prices are surging, trading around $1,929, precisely at $1929.20 at the time of writing; marking a gain of more than 3.21%. Israeli ground actions in Gaza instead of air strikes increase global tensions and strengthen safe-haven assets.

US Treasury yields are under pressure due to declining US consumer sentiment and dovish comments made by Philadelphia Fed President Patrick Harker.

Friday’s spectacular gain in the price of gold is continuing as geopolitical tensions in the Israeli-Palestinian conflict rise. In times of unpredictability, traders looking for protection go towards the yellow metal, while the US dollar is also strengthening. After recovering from daily lows of $1,868.69, the troy ounce of the XAU/USD is currently trading at $1,929.20, up more than 3%.

As investors look for safe havens in the face of geopolitical unrest and worsening US Consumer Sentiment, gold is reportedly getting close to the $2,000 mark. As gold prices increased by more than 3% in response to news that Israel is switching from air to ground operations in the Gaza strip, the yellow metal found dip buyers amid concerns that the conflict could spread to other Middle Eastern regions.

As a result, safe-haven investments are still in demand as we approach the weekend, boosting the likelihood that the non-yielding metal will reach the $2,000 level.

According to a University of Michigan (UoM) October study, economic statistics from the United States (US) showed that consumer sentiment among Americans is still declining. In addition, Patrick Harker, the president of the Philadelphia Fed, said that no future rate increases “are likely” to be needed.

As a result, US Treasury bond yields slowed down, especially the US 10-year Real Yields, which remained at 2.289% and decreased seven basis points in line with the 10-year benchmark note’s yield of 4.629% and decreased seven basis points.

The US Dollar Index (DXY), which often acts as a drag on gold prices, is up 0.08% and is currently trading at 106.66, while safe-haven assets, which typically correlate adversely, are moving together to the upside.