Gold extended its strengthening trend for the third consecutive day, breaking through an all-time high above $4,500 following limited US economic data releases this week and the support of prolonged geopolitical conflicts.
At 9 am, gold prices were at $4,518, up 0.77% since it opened early Wednesday in Asian trading.
Bullion continued to gain ground among the majority of investors due to increased global geopolitical tensions, thus maintaining demand for safe-haven assets.
At the same time, continued expectations that the US Federal Reserve (Fed) could potentially implement interest rate cuts until 2026 also contributed to positive market sentiment, helping gold prices remain supported near record highs.
Geopolitical tensions between the United States and Venezuela remain high following President Donald Trump's actions to impose sanctions on oil tankers traveling to and from Venezuela.
US authorities have reportedly seized two Venezuelan-linked oil tankers this month, including one over the weekend. This development reflects heightened geopolitical risks that continue to weigh on global market sentiment.
In addition, gold price movements were also influenced by portfolio restructuring activities at the end of the year, as the market approaches the long holiday period. While profit-taking at high prices could trigger a short-term consolidation phase, the overall trend remains positive.
Gold is currently on track to record its strongest annual performance since 1979, with a rise of almost 70% so far.
On the economic front, the US Bureau of Economic Analysis reported strong economic growth at an annualized rate of 4.3% for the Third Quarter, beating market expectations of 3.3% and an initial estimate of 3.8%.
At the same time, inflationary pressures remain high, with the GDP Price Index increasing by 3.7%, while Core Personal Consumption Expenditures (PCE) and PCE Prices increased by 2.9% and 2.8% respectively.
This report gave mixed signals among market players and a more cautious mood towards the value of the US dollar.
