Gold prices rose on Monday, above the key 2000 dollar level, driven by demand for safe assets due to the escalating conflict in the Middle East, as investors await the Federal Reserve meeting later this week.
Gold futures jumped by 0.6% to USD 2,011.20, while the spot price of the yellow metal hit USD 2,001.37.
War tensions between Israel and Hamas are escalating, as Palestinian media reported that Israeli airstrikes hit areas near the Shifa and Jerusalem hospitals in Gaza City early on Monday, and Palestinian gunmen clashed with Israeli forces in a border area east of the city of Khan Yunis in the south of the Strip.
Gold prices hit 2,009.29 dollars per ounce on Friday, surpassing the psychological level of 2,000 dollars for the first time since mid-May, with investors turning to the yellow metal as a safe haven.
Investors are looking forward to the decision of the monetary policy of the US Federal Reserve, the day after tomorrow, Wednesday. While the Fed is widely expected to fix interest rates, the focus will be on the statements of Jerome Powell, the Fed Chairman.
Matt Simpson, senior analyst at “City Index”, said that the wave of strong economic data means that it will force the Fed to maintain its hawkish tone, despite growing concerns about the conflict in the Middle East.
Simpson added that this is supposed to maintain a minimum for gold prices, which seem stable above 2000 dollars at the beginning of the week.
According to a report by Reuters, inflation pressures will follow the global economy next year, according to the expectations of more than 200 economists polled by Reuters, where they pointed out that the main risk is that inflation will become higher than they expected, suggesting that interest rates will remain high for a longer period.
