BENGALURU: Gold prices fell on Monday after solid gains in the previous session, but the safe-haven metal held firm above key $1,900 per ounce level as escalating conflict in the Middle East kept investors on edge. Spot gold was down 0.6% to $1,920.10 per ounce by 12:13 p.m. ET (1613 GMT), after hitting its highest since Sept. 20 in the previous session. US gold futures was down 0.4% to $1,933.40.
“We’re just seeing some healthy consolidation from the recent gains ...just some normal profit taking by the short-term futures traders,” said Jim Wyckoff, senior analyst at Kitco Metals.
“We’ve got a serious geopolitical situation playing out in the Middle East, I think gold prices are going to track sideways to higher here in the next few weeks with $2,000 not out of the equation.”
Gold, used as a safe investment during times of political and financial uncertainty, has risen more than $100 since falling to a seven-month low on Oct. 6, owing to safe-haven inflows as the Israel-Hamas conflict enters its 10th day.
US officials warned that the war between Israel and militant group Hamas could escalate, as US warships headed to the area amid growing clashes on Israel’s northern border with Lebanon.
While investors wait for further updates on the Israel-Hamas war, Federal Reserve Chair Jerome Powell’s speech later this week will also be closely watched for more clarity on US interest rate path. Markets are pricing in around a 90% chance that the Fed will leave interest rates unchanged at their policy meeting next month, according to the CME FedWatch tool.
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