Gold rose to a record high on Wednesday as tensions in the Middle East and US tariff uncertainties lifted the bullion's safe-haven appeal, while traders awaited the Federal Reserve's decision later in the day.
Spot gold added 0.2% to $3,039.38 an ounce as of 0745 GMT. Earlier in the session, it hit an all-time peak of $3,045.24, the 15th one this year.
US gold futures gained 0.2% to $3,046.40, Reuters reported.
"At its current trajectory, gold futures could tag $3,200 in just over a month. Even if we get a shakeout or two along the way, I suspect bulls are laying in wait for a discount, however small," said Matt Simpson, a senior analyst at City Index.
Investors are worried about an economic slowdown and elevated risks of recession due to US President Donald Trump's trade tariffs, which are widely considered likely to stoke inflation.
The tariffs have escalated trade tensions and include a flat 25% levy on steel and aluminium, which came into effect in February, and reciprocal and sectoral tariffs to be imposed on April 2.
"There seems to be little standing in gold's way for now, with renewed geopolitical tensions in the Middle East, rising global economic risks and tariff uncertainties driving its appeal as a safe-haven asset against market volatility," said IG market strategist Yeap Jun Rong.
Israeli airstrikes killed more than 400 people in Gaza, as Israel warned the onslaught was "just the beginning."
The Fed, which will conclude its two-day policy meeting later in the day, is expected to hold its benchmark interest rate steady in the 4.25%-4.50% range.
"If the FOMC meeting takes on a dovish tone in response to growing uncertainty over how tariffs may impact growth... this could be a green light for gold to make a push above $3,050," KCM Trade chief market analyst Tim Waterer said.
Non-yielding bullion thrives in a low interest rate environment.
Markets also await Fed chair Powell's speech at 1830 GMT for further clues on policy outlook.
Spot silver fell 0.4% to $33.89 an ounce, platinum lost 0.7% to $989.95 and palladium shed 0.7% to $960.68.
Gold Climbs to Record High on Safe-haven Demand; Fed Decision in Focus
Gold necklaces on display at a jewelry store in Beijing, China, 19 March 2025. EPA/JESSICA LEE
Gold Climbs to Record High on Safe-haven Demand; Fed Decision in Focus
Gold necklaces on display at a jewelry store in Beijing, China, 19 March 2025. EPA/JESSICA LEE
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