Gold prices climbed during Asian trading hours on Wednesday following a report that Israel might be preparing to strike Iran’s nuclear facilities, which spurred safe-haven buying. A weakening U.S. dollar also lent support to the precious metal.
Ongoing concerns about America’s fiscal outlook and uncertainty surrounding trade negotiations helped sustain demand for gold, allowing it to recover part of last week’s losses.
By 00:57 ET (04:57 GMT), spot gold had gained 0.4% to reach $3,302.02 per ounce, while June gold futures rose 0.6% to $3,303.62 per ounce.
Israel-Iran Tensions Drive Safe Haven Rally
The uptick in gold followed a CNN report stating that Israel was making preparations for a potential strike on Iranian nuclear sites, according to unnamed U.S. intelligence sources.
Although no official decision had been made, military activity pointed toward readiness for an attack.
Such a move would likely trigger heightened geopolitical instability in the Middle East and could undermine Washington’s diplomatic efforts with Tehran. Given past hostilities between Israel and Iran, a retaliatory strike would be expected, escalating regional tensions further.
This potential escalation drove oil prices higher and increased demand for traditional safe havens like gold and the Japanese yen.
Mixed Movement in Precious and Industrial Metals
Precious metals were mixed overall but saw some strength this week due to a softer dollar. Platinum futures slipped 1% to $1,050.50 per ounce, while silver futures edged up 0.2% to $33.255 per ounce.
Industrial metals also made gains. London copper futures rose 0.4% to $9,559.25 per ton, and U.S. copper futures increased by 0.4% to $4.6928 per pound.
Dollar Weakness Boosts Commodities
The recent slide in the U.S. dollar has benefited gold and other dollar-denominated commodities. The decline followed a one-notch downgrade of the U.S. sovereign credit rating by Moody’s, which cited elevated fiscal spending and rising national debt.
Additionally, cautious comments from several Federal Reserve officials regarding economic and trade risks have kept pressure on the greenback, even though the Fed has not signaled any immediate plans for interest rate cuts.
Gold continues to trade comfortably above $3,000 per ounce and remains within striking distance—less than $200—of the all-time high reached earlier this month.
