Tension fears 'heighten gold buying'
Investors are increasingly seeking to store their assets in reliable commodities such as gold bullion as market turmoil increases.
According to a report by America's ABC news, Israel may attack Iran, the world's second largest oil producer, as tensions mount over its nuclear activities.
This could increase crude oil prices, which in turn may lead to a rise in gold prices as investors use it as a hedge against inflation and the increasingly shaky currencies, reports Bloomberg.
"Gold is always a safe-haven asset. You've got inflation, geopolitical risk, extremely high oil prices and a weak economy. All the pieces of the puzzle are there for gold to go higher," said '' said Matt Zeman, a metals trader at LaSalle Futures Group in Chicago.
Gold is becoming more affected by supply and demand fundamentals as it gets harder to obtain while demand grows.
Earlier this month, the Ghanaian government upped power rates by 100 per cent, which could significantly reduce gold output in the African country.
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