Gold prices edged higher in early Wednesday trading, consolidating above the $3,750 level and remaining close to the record high reached during the previous session. The precious metal is benefiting from stronger safe-haven demand as tensions escalate in Eastern Europe and the Middle East, following several incidents involving Russian aircraft and drones entering NATO airspace, as well as Israel’s ongoing offensive in Gaza. The rise in geopolitical turbulence is intensifying existing risks and, together with the economic uncertainty triggered by tariffs, is boosting the appeal of gold, which many investors regard as the ultimate refuge asset. At the same time, bullion is finding additional support from expectations that the Federal Reserve will deliver two further 25-basis-point rate cuts before the end of the year, with more to follow in 2026. This dovish outlook is dollar-negative and supportive for gold due to the inverse price correlation between the two assets, while also fuelling concerns that inflation could return — a scenario that underpins a bullish outlook and could pave the way for further gains in the precious metal.
Ricardo Evangelista, ActivTrades
Source: ActivTrader
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