Safe-haven buying fueled Gold prices to an 11-week high on Wednesday, as the front-month Comex futures price approached $2,000 an ounce.

At 7 am Sydney time, the front-month contract surged by over $26 or over 1.3%, to just over $1,963.

Despite higher bond yields and a strengthening greenback, Comex Gold Prices have climbed 4% over the past five days and it was 11 week high on Wednesday.

US bond yields reached multi-year highs, with the 10-year Treasury bond yield surpassing 4.90% for the first time since 2007. The US dollar also strengthened due to safe-haven buying of greenback-denominated assets.

A three-week high of just over an ounce was also reached by Comex silver prices.

Australian dollar gold prices soared to $3,076 an ounce overnight due to the weakness of the Aussie dollar, which fell nearly half a percent overnight to 63.35 US cents. Despite the weaker trend for gold miners on Thursday, this price surge may buck this trend.

Oil prices also increased, primarily due to supply disruptions caused by the Gaza conflict rather than safe-haven purchases.

It was reportedly over 500 people who died in a hospital bombing in Gaza that prompted the demand for safe havens. The US and President Biden, who argued that the “other team” was responsible, supported Hamas’ claim that an Israeli airstrike caused the incident, while Israel blamed an errant Hamas missile.

Barrons headlined, “Rate fears, bond yields, war; market concern grows.”

Managing director at Kitco Metals, Jim Wyckoff, commented on the situation, saying, “Elevated Middle East risks are driving safe-haven demand for gold. The technicals have also improved. I think gold will push to ,000 in the near future.”

Gold will pull back if the Middle East situation calms down, but the market is expecting further escalation at the moment.

A speech by Fed Chair Jay Powell tonight, Australian time, could influence the precious metal’s future performance, though some analysts questioned whether this is just a temporary spike.

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