Gold prices near two-month highs after Israel’s strike on Iran

Investing.com--Gold prices rose to near two-month highs Friday after Israel launched a major strike on Iran, hitting “dozens” of military and nuclear targets, spurring demand for traditional safe-haven assets.

At 07:10 ET (11:10 GMT), Spot gold jumped 0.9% to $3,417.10 an ounce, close to the record high of $3,500 it hit in April, and Gold Futures for August rallied 1% to $3,436.90/oz. 

Both are on course for weekly gains of around 3%.

Israel strikes Iran; boosts safe-haven demand

Demand for gold, often seen as a safe haven in times of stress, soared Friday after Israel carried out a military strike on Iran, hitting “dozens” of military and nuclear targets in what has been described as the largest attack on the Islamic Republic since the Iran-Iraq war of the 1980s.

The move came just days before U.S. and Iranian officials were set to attend a sixth round of nuclear deal talks.

U.S. Secretary of State Marco Rubio said that Israel carried out its military action against Iran independently, citing self-defense as the driving motive behind the strikes.

The White House had earlier warned it would consider military measures should nuclear negotiations fail, with a key response deadline ending Thursday. 

Iran responded by launching more than 100 drones toward Israeli territory, an Israeli military spokesman said. Sirens and a state of emergency were declared across Israel amid warnings of an imminent missile and drone counter‑strike from Tehran.

Cooler U.S. inflation helps

Gold’s rise is further supported by easing inflation pressures in the U.S., the largest economy in the world.

Recent U.S. data indicating high unemployment benefit claims and subdued producer prices increased expectations of Federal Reserve rate cuts, enhancing the appeal of non‑yielding assets like gold.

That said, Goldman Sachs on Thursday trimmed its U.S. recession probability to 30% from 35% for the next twelve months on easing uncertainty around President Donald Trump’s tariff policies after the U.S. and China affirmed a trade deal.

Platinum Futures fell 2.4%, but remained near a four-year high, and Silver Futures fell 0.2% to $36.23/oz, remaining close to a recent 13-year peak. 

Among industrial metals, benchmark Copper Futures on the London Metal Exchange fell 1.5% to $9,553.05 a ton, while U.S. Copper Futures declined 2.1% to $4.7380 a pound.

Ayushman Ojha contributed to this article

Bullion prices had risen earlier in the week on U.S.-China trade uncertainty. Despite signs of progress, vague details kept investors cautious.