Source: Wall Street See

Due to further escalation of the Middle East situation and the ongoing deadlock in the US election, investors are flocking to safe-haven assets, causing the gold price to reach a new historical high.

During the morning session today, the spot gold price reached the $2,700 mark, with the highest reported at $2,714.12 per ounce.

As of the time of publication, the gold price increase has fallen to 0.39%, at $2,703.18 per ounce, accumulating a rise of approximately 30% this year.

Why did gold surge?

Geopolitical tensions and election risks have jointly boosted market risk aversion sentiment.

According to Xinhua News Agency, on the 17th, Israel announced that the leader of the political bureau of the Palestinian Islamic Resistance Movement (Hamas), Yahya Sinwar, had died in Gaza. Hezbollah in Lebanon stated on the 17th that their confrontation with Israel has entered a "new escalation stage".

Prime Minister Netanyahu posted a video statement on social media, stating that the death of Sinwar will not end the Gaza conflict, but it is the "beginning" of the end of the Gaza conflict. "As long as Hamas lays down their weapons, returns hostages, the war can end."

Meanwhile, with only three weeks left until the November 5th US election day, investors are beginning to reassess election risks.

Forex strategist Christopher Wong from OCBC Bank stated:

"There is a clear discrepancy between traditional polls and scattered betting polls, even as we get closer to the election."

"Given the instability of election developments and geopolitical uncertainties, hedge measures for a Trump victory - long positions in gold - may still be sought after."

However, at present, Trump's lead in key swing states is expanding, and expectations of his election are suddenly heating up.

Another factor driving up the price of gold is the potential signs of a dollar retracement.

Christopher Wong stated that from a technical perspective, the dollar's rebound appears somewhat weak, "the possibility of a near-term retracement should not be ruled out."

In addition, the US September retail sales data released overnight exceeded expectations, suppressing loose expectations and further boosting risk aversion.

From a broader perspective, with the Fed's rate cut last month, optimism about rate cuts has driven the recent rise, and strong buying from global central banks has also been a long-term support for gold prices.

According to the survey data from representatives of the London Bullion Market Association Annual Conference held this week, it is expected that by late October 2025, the gold price will rise to around $2917 per ounce.

Bank of America: Gold may replace US bonds as the safest "haven", expected to rise to $3000.

Michael Widmer, a commodity strategist at Bank of America, recently released a research report stating that given the dilemma facing US debt issues, gold may be more attractive.

Widmer said that regardless of whether Trump or Harris is elected, the US is likely to face a prospect of expanding deficits.

According to data from the Committee for a Responsible Federal Budget, Trump's tax plan calls for an increase of about $7.5 trillion in new debt, while Harris's fiscal plan would require an increase of $3.5 trillion in debt.

Furthermore, according to Widmer, as countries adapt and respond to climate change, fiscal expenditure commitments worldwide may increase, and demographic changes are expected to become more challenging, with defense spending likely to increase as well.

Therefore, Widmer believes that gold is expected to rise further to $3,000 per ounce:

"Due to investors' concerns that increasing US expenditure demand may impact the US bond market, gold may become the ultimate safe haven asset in people's minds."

Editor / jayden