The price of gold rose as traders assessed geopolitical tensions in the Middle East and the impact of US tariffs on global trade.
The price of the precious metal rose to around $5,200 an ounce, after recording gains of nearly 6% during the past six sessions, amid a buildup of US forces in the Middle East that kept global markets on edge.
Washington imposed sanctions on more than 30 entities that support Iranian oil and arms sales, increasing pressure on Tehran ahead of the latest round of nuclear talks on Thursday in Geneva.
Meanwhile, the administration of US President Donald Trump has pressed ahead with steps to maintain its tariff agenda, adding to already strained relations with trading partners.
U.S. Trade Representative Jameson Greer said Trump would sign a directive raising global tariffs to 15% when appropriate. Broad tariffs of 10% went into effect Tuesday after the Supreme Court struck down what were known as Trump's tit-for-tat tariffs.
Re-pricing of geopolitical and trade risks
Christopher Wong, a strategist at Overseas Chinese Banking Corp., said recent moves in gold reflect a repricing of new uncertainty over tariffs and geopolitical concerns.
He added that movement in both directions is likely as the market digests the latest news, including Federal Reserve policy and dollar movements. The US dollar index fell 0.1% on Thursday, after closing 0.2% lower in the previous session.
Gold has risen by about 20% this year, finding renewed support above the $5,000 per ounce level after a sharp two-day decline from a record high of $5,595 in late January.
Ongoing geopolitical and trade tensions have revived a multi-year rally, boosting bets against the dollar as investors shift away from the U.S. currency and Treasury bonds.
Concerns about the independence of the Federal Reserve
In a further sign of the tensions, Cuban forces killed four people who had opened fire from a speedboat bearing Florida license plates, in an incident that carries the potential to escalate a tense standoff with the United States.
Concerns about government interference in the policies of the US Federal Reserve also supported the precious metal. In a farewell article before his retirement, Atlanta Federal Reserve President Raphael Bostic wrote that he was concerned that Americans were beginning to question the independence of the central bank.
Spot gold rose 0.5% to $5,188.76 an ounce by 9:19 a.m. in Singapore. Silver also climbed 0.9% to $89.99, while platinum and palladium both gained.
