Gold has surged again to its highest level in recent months as escalating tensions between Israel and Iran drive safe-haven demand for the metal.
Gold reached $US3435 on Friday, surpassing its previous peak of $US3433 on April 22. This is also up more than three per cent since June 11.
The rally comes amid fears of a broader conflict in the Middle East, with Israel and Iran engaging in drone and missile attacks.
“Israel knocking out Iranian targets is causing a little bit of geopolitical scare in the market,” RJO Futures senior market strategist Daniel Pavilonis told FXStreet. “Prices will stay elevated in anticipation of what is to come – the retaliation by Iran.”
FX Empire senior market analyst James Hyerczyk said gold remains in a strong uptrend, underpinned by both geopolitical risk and favourable monetary policy expectations.
“Unless diplomatic breakthroughs emerge or inflation unexpectedly surges, the yellow metal looks poised to challenge and potentially break its April record high,” he said.
This comes after State Street Global Advisors (SSGA) released its mid-year 2025 gold outlook, expecting gold to trade between $US3100–3500 per ounce in 2025, supported by ongoing economic uncertainty, investor anxiety, and persistent weakness in the US dollar.
A more bullish scenario, which SSGA assigns a 30 per cent probability, suggests gold could climb towards $US4000 per ounce over the next six to nine months if macroeconomic conditions deteriorate further.
SSGA said gold continues to shine amid economic uncertainty, consumer anxiety, and a weaker US dollar, reinforcing the metal’s role as a low-volatility, portfolio-diversifying, safe-haven asset.
“Demand for gold as a low volatility, portfolio diversifying, perceived safe-haven asset, should continue especially as the probability distribution of policy, geopolitical, and macroeconomic outcomes widens,” the report said.
“Gold’s price run during the first five months of 2025 – up 25 per cent to $US3300 per ounce – once again places it at the top of the leaderboard for global macro asset classes.”
Subscribe to Australian Resources & Investment and receive the latest news on commodity prices, resource developments, executive movements and more.