US election uncertainty pushes safe-haven gold to record peak
NEW YORK (October 30) Gold surged to a record high on Wednesday as uncertainty surrounding the U.S. presidential race spurred demand for safe-haven assets, while traders awaited cues on interest rate cuts.
Spot gold rose 0.2% to $2,781.51 per ounce by 0925 GMT, after hitting an all-time high of $2,789.73 earlier in the session.
U.S. gold futures rose 0.5% to $2,793.50.
The Nov. 5 election has entered its final stretch, with recent polls indicating a fiercely competitive race between Republican former U.S. President Donald Trump and Democratic Vice President Kamala Harris.
Gold is rising due to the uncertainty related to the outcome of the election and with markets pricing another Fed rate cut next week, said Ole Hansen, head of commodity strategy at Saxo Bank, adding that weakness in dollar is also supporting prices.
"We now have $2,800 as the next major red flag to the bulls. If prices drop, it could fall to $2,715."
Bullion, seen as a hedge against geopolitical uncertainties, has surged 35% so far this year and is on track for its best annual growth since 1979. Gold also tends to thrive in a low interest rate environment.
Fed policymakers are nearly certain to reduce short-term borrowing costs by a quarter-point next week, following a drop in job openings last month.
This week's data includes ADP employment report at 1215 GMT, U.S. Personal Consumption Expenditures on Thursday and Friday's payrolls report.
Global gold demand, excluding over-the-counter trading, was steady year-on-year at 1,176.5 metric tons in the third quarter as higher investment activity offset reduced jewellery consumption, the World Gold Council said.
Gold demand in India, the world's second-biggest consumer of the precious metal, is likely to fall to its lowest in four years in 2024, the WGC said.
Palladium fell nearly 4% to $1,180.38 per ounce, after hitting a 10-month high in the previous session.
The short-covering rally triggered by news on potential Russian sanction has run its course, Hansen said.
Spot silver shed 0.8% to $34.17 per ounce and platinum eased 0.8% to $1,037.10.
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