Gold prices scaled a new peak for the fourth consecutive session in the international market on Thursday. Heightened US-China trade frictions and bets that the Federal Reserve will cut interest rates through the end of the year have supported demand.
The precious metal jumped 0.5% to $4,227 an ounce in the spot market. Bullion has risen about 5% so far this week amid a breakneck rally underway since mid-August. In October so far, the metal has appreciated by 9.5%.
The buying spree has spread to other precious metals, with silver surging more than 3% on Wednesday as availability in the London market remained tight, Bloomberg News reported.
Markets have forecasted at least one outsized Fed rate cut by December. Lower rates reduce the value of the US dollar, leading to a rise in gold prices.
President Donald Trump declared the US was now locked in a trade war with China, spurring fears of prolonged damage to the global economy that could boost gold’s haven appeal.
Gold has outperformed equities so far this year. While the bullion has appreciated nearly 60%, the US benchmark S&P 500 index has gained 14% and the MSCI World Index has risen 16%. India's benchmark Nifty 50 has delivered a paltry 6.6% return during this period.
Prices of other precious metals also rallied on Thursday. Spot silver prices jumped 0.4% to $53.25, just a few cents lower than its life high. Palladium and platinum were up 0.5% and 0.6%, respectively.
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