On Thursday (October 24), the spot gold price surged by $20.52, closing at $2735.76 per ounce, an increase of 0.76%. This rise was mainly driven by the decline in both the U.S. dollar and U.S. bond yields, geopolitical tensions worldwide, and concerns over the U.S. fiscal debt issue.
The day before, gold prices had dropped by over $33, causing a strong market reaction. However, as the yield on the US 10-year treasury fell to 4.20% and the dollar index slipped to 104.00, demand for gold rebounded. Analysts pointed out that as the U.S. election approaches and uncertainties rise, the market's risk-aversion demand increases significantly, providing support for the gold market.
Global macroeconomic uncertainties are becoming more pronounced, especially as central banks in major economies trend towards looser monetary policies. Gold, as a traditional safe-haven asset, has seen its appeal greatly strengthened. Particularly, the escalating tensions in the Middle East have heightened investor demand for gold. Meanwhile, concerns over the U.S. fiscal debt issue have further eroded market confidence in the dollar. The ever-expanding scale of U.S. debt has become a risk point of interest for global investors.
Since the beginning of the year, gold prices have cumulatively increased by over 32%, repeatedly hitting historical highs. As the global economic recovery becomes more complex and political risks rise, gold prices are likely to continue to climb in the future.
