Gold GCG26 surpassed US$4,800 an ounce for the first time on Wednesday as geopolitical tensions including U.S. President Donald Trump’s bid to control Greenland drove safe-haven demand.
Spot gold was up 1.6 per cent at US$4,838.91 per ounce by 11:30 a.m. ET, after rising as far as US$4,887.82 earlier in the session. U.S. gold futures for February delivery climbed 1.7 per cent to US$4,844.20 per ounce.
“There’s a bit of fear of missing out on this trade and I think given the geopolitical situation in the world, it’s a perfect storm for higher gold and higher silver prices right now,” said RJO Futures senior market strategist Bob Haberkorn.
U.S. stocks staged a modest recovery after the sharpest equities selloff in three months, as investors digested Trump’s speech in Davos, in which he said Europe is headed in the wrong direction but ruled out using force to acquire Greenland.
Meanwhile, the U.S. Supreme Court is hearing appeals challenging Trump’s unprecedented attempt to fire Federal Reserve Gov. Lisa Cook, in a case that is testing the central bank’s independence.
The Fed is likely to hold its key interest rate through this quarter and possibly until Chair Jerome Powell’s tenure ends in May, according to a majority of economists polled by Reuters.
Lower interest rates are favourable for non-yielding gold.
Spot silver fell to US$93.5 an ounce, after hitting a record high of US$95.87 on Tuesday.
“Silver’s rise to a three-digit number is looking quite possible given the price momentum we are seeing, but it will not be a one-way move. There could be some correction in prices and volatility can be higher,” said Soni Kumari, ANZ commodity strategist.
Spot platinum added 2.5 per cent to US$2,524.75 per ounce after hitting a record US$2,543.99 earlier in the day. Palladium was down 0.3 per cent at US$1,859.50, after touching its highest in a week.