Gold's explosive climb to $2,000 amid escalating Middle East tensions

During the continuous violence in the Middle East, demand for safe-haven assets has increased, and gold prices have stayed near to the crucial $2,000 level on Monday. The U.S. The Federal Reserve policy meeting this week was also highly expected by market observers.

Jim Wyckoff, senior analyst at Kitco Metals, says the Middle East conflict is helping the gold and silver markets. He's optimistic about the future of gold, expecting prices to rise due to the ongoing conflict.

As of right now, the price of gold has dropped by 0.4% to $1,998.47 per ounce, while U.S. gold futures increased by 0.4% to $2,005.60.

Last Friday marked the first time since mid-May that gold prices surpassed $2,000 per ounce, reaching $2,009.29. This increase is driven by traders seeking safety in precious metals during uncertain times.

According to StoneX analyst Rhona O'Connell, gold is presently maintaining and getting ready for future rises that could be dependent on geopolitical events.

Traders are closely monitoring the U.S. central bank's policy decision on Wednesday, with Chair Jerome Powell's remarks expected to show signs of a more hawkish stance. A hawkish tone could potentially negatively affect the gold market, as higher interest rates reduce its appeal.

In the meantime, spot silver prices increased by 0.9% to $23.34. Heraeus analysts expressed concerns on the demand for silver, especially in light of the European Union's recession. They added that silver usually moves in tandem with gold during recessions, but that in times of slower economic growth, traders tend to choose gold as a safe haven, while silver is viewed more as an industrial metal. As such, under these circumstances, silver is predicted to perform worse than gold.

Palladium experienced a more moderate 0.3% gain to $1,125.65, while platinum witnessed a noteworthy 3.1% jump to $931.96 among other precious metals.