13.06.2025 01:48
Gold prices surged past the $3,400 mark on Friday, reaching their highest point in over five months, driven by escalating geopolitical tensions in the Middle East and growing expectations of Federal Reserve interest rate cuts. The precious metal climbed to approximately $3,425 during Asian trading hours.
This significant price increase follows a statement by Israeli Defense Minister Israel Katz on Thursday evening, announcing a preemptive strike against Iran and declaring a state of emergency in anticipation of retaliatory actions. This heightened geopolitical uncertainty directly contributed to the gold price surge. Peter Grant, vice president and senior metals strategist at Zanier Metals, noted that the increase marks the second consecutive day of growth, primarily attributed to elevated geopolitical risks. He further predicted that while minor resistance levels exist around $3,417 and $3,431, a continued upward trend seems probable, potentially leading to record-high prices.
Gold's enduring appeal stems from its historical significance as a reliable store of value and medium of exchange. Today, beyond its aesthetic value in jewelry, it's widely recognized as a safe haven asset, a preferred investment during periods of economic or political instability. Its inherent value is independent of any single issuer or government, making it a hedge against inflation and currency devaluation.
Central banks play a pivotal role in the gold market, holding substantial reserves. Their strategic gold purchases, designed to bolster their currencies during turbulent economic times and enhance their perceived economic strength, highlight the metal's importance. The World Gold Council's data reveals that central banks globally added a staggering 1,136 tonnes of gold—valued at roughly $70 billion—to their reserves in 2022, marking a record high since record-keeping began. This significant increase is particularly notable, with emerging economies such as China, India, and Turkey leading the way in bolstering their gold holdings.
