Gold rises amid demand for safe-haven assets: this is the best week in almost 2 years

Gold prices broke above the US$2,700 threshold for the first time in more than two weeks on Friday (Nov 22), on course for their biggest weekly gain in nearly two years as demand for safe-haven assets outweighed dollar strength and easing expectations of US rate cuts. next month.

By 1:51 pm ET (1851 GMT), spot gold was up 1.5% at US$2,709.24 an ounce, its highest since November 6. US gold futures rose 1.4% to US$2,712.20.

“The escalation of the Russian-Ukrainian conflict looks like it is escalating into a Russian-American war, and that certainly increases the appeal of short-term safe havens,” said Alex Ebkarian, chief operating officer of Allegiance Gold.

Bullion has gained more than 5.7% this week, its best weekly performance since March 2023, when a wave of banking crises roiled global markets and boosted demand for safer assets.

The rise in gold prices this week has been driven by the intensifying Russia-Ukraine crisis, which has seen prices rise by more than US$170 from last Thursday’s two-month low of US$2,536.71.

Bullion tends to shine during periods of geopolitical tension, economic risk and low interest rate environments.

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Gold’s gains continued on Friday even as the US dollar hit a two-year high and Bitcoin hit a record high.

Expectations for a December rate cut by the US Federal Reserve have eased, with the probability now at 53 percent, a sharp drop from 82.5 percent just a week earlier.

Some Fed policymakers this week expressed concern that inflation progress could stall, urging caution, while others stressed the need for further rate cuts.

Given ongoing policy changes and inflation risks associated with U.S. President-elect Donald Trump’s proposed trade tariffs, the outlook for gold remains strong, with a test of US$2,750 expected by mid-December, Ebkarian said.

Spot silver rose 1.5 percent to US$31.24 an ounce, palladium fell 1.4 percent to US$1,015 and platinum rose 0.6 percent to US$964.36. All three metals were on track for weekly gains.

“In our view, the price of platinum in particular is set to rise significantly as the market is likely to experience a third year of shortages in 2025,” Commerzbank analysts said. REUTERS