Gold prices surged to a new high on Wednesday, surpassing US$5,300 an ounce for the first time, supported by a weaker US dollar and concerns about the independence of the US Federal Reserve.
Spot gold rose 1.5% to around US$5,266 an ounce after hitting an intraday record, while US gold futures for February delivery jumped 3.5%. The rise followed a surge of more than 3% in the previous session.
Analysts said the rise in gold prices reflected a shift in investor confidence in the global monetary and fiscal order, as well as increased demand for safe-haven assets as policy uncertainty looms.
The US dollar is near a four-year low after President Donald Trump signaled that the new Fed chairman may be more inclined to support lower interest rates, a factor that usually supports gold prices.
Gold has risen more than 20% since the start of the year, with Deutsche Bank expecting prices to hit US$6,000 an ounce this year, supported by strong investment demand even as high prices weigh on jewelry demand.
