Gold shows early signs of reclaiming safe-haven appeal after Iran war selloff
LONDON — Gold's 9 percent rebound in August to around $4,400 an ounce suggests bullion is starting to regain favour with institutional investors and central banks, leaving the market better placed to extend gains as it moves beyond the initial shock of the U.S.-Israeli war with Iran. The outbreak of the war in late February drove gold from a record high of $5,595 per ounce in January to below…
London — Gold's 9 percent surge in August to around $4,400 an ounce indicates the precious metal is beginning to attract institutional investors and central banks once again, setting the stage for potential further gains as the market recovers from the initial impact of the U.S.-Israeli conflict with Iran. The outbreak of war in late February caused gold to plummet from its January record high of $5,595 per ounce to under $4,000 in June, as investors sought liquidity and some central banks used reserves to bolster domestic economies amid a surge in oil prices.
Analyst Ross Norman believes the market has finally released gold's brakes, noting that gold prices have broken above two key resistance levels this month, aided by lower oil prices and better-than-expected U.S. inflation data that lowered expectations for future interest rate hikes. HSBC's chief precious metals analyst, James Steel, agrees that if oil prices do not spike again and tensions in the Middle East do not escalate, gold's most likely path forward is upward.
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