Gold has closed at its highest level in six years as fresh U.S. sanctions on Iran add to uncertainty in global financial markets.
Investors seeking sanctuary sent spot gold up 1.4% on Monday to $1,439.21 U.S., the precious metal’s highest level since May 2013. At the same time, the U.S. dollar hit a three-month low in trading Monday. Other precious metals saw declines as gold hit new highs – silver fell 0.3%, platinum lost 0.2%, and palladium fell 0.8%.
Gold’s rise has been driven by volatile capital markets that have been spooked by several unknowns, including the ongoing trade war between the U.S. and China, rising tensions in the Middle East and the uncertain path forward on Brexit in Europe.
Gold has been on a tear in recent weeks as the U.S. dollar has weakened after the Federal Reserve opened the door to an interest rate cut this year. Investors are taking note, pouring money into exchange-traded funds backed by gold and boosting their overall positions in U.S. gold futures and options. Investment bank Morgan Stanley has said that gold is its top commodity pick as the uncertain macroeconomic outlook adds to its appeal.
