The price of gold has jumped by 1.4% as demand for the safe-haven asset grows amid Israel’s strikes on Iran’s nuclear and military facilities. Gold is now about 2% from passing its all-time high of $3,500.20 as the precious metal continues its standout year.
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“As I’ve been highlighting recently, don’t look to US Treasuries for ‘safe haven’ or ‘flight to quality’ flows. Their yields barely budged after the Israeli attack on Iran. Instead, watch gold (below) and silver,” said Mohamed El-Erian, President of Queen’s College, Cambridge on X this morning.
Gold Rises as Stocks Fall
Although stocks and gold do not exhibit a perfect inverse correlation, the two assets tend to move in opposite directions during times of economic uncertainty. This is due to investors seeking to reduce risk. Stocks are generally viewed as riskier than gold, which acts as a store of value.
Spot gold has returned nearly 30% year-to-date.
