Gold prices increase for 5 consecutive sessions, reaching a peak for more than 4 weeks

Gold prices rose for the fifth consecutive session on Tuesday, as investors turned to safe haven assets amid escalating tensions between the US and Israel against Iran, raising concerns that the conflict could spread into a prolonged regional war and increase in instability.

Spot gold prices recorded at 11:00 AM on March 3rd (Vietnam time) up 0.84%, to $5,365.4/ounce. In the previous session, this precious metal hit its highest level in more than four weeks, after the US and Israel launched airstrikes against Iran last weekend.

Mr. Tim Waterer - Head of Market Analysis at KCM Trade - commented: "The scope and duration of the conflict are still very unpredictable. In such a volatile context, gold is attracting large sums of money seeking safe haven.

Iranian media reported that a senior official of the Iranian Islamic Revolutionary Guard Corps (IRGC) on Monday announced that the Strait of Hormuz has been closed, and warned that Iran will fire at any ships trying to pass through this strategic maritime route.

This is Iran's toughest warning since the country announced the closure of its oil export route on Saturday. This move could disrupt about 1/5 of global oil flow through the straits, pushing crude oil prices up sharply.

Meanwhile, the USD fluctuated near its highest level in more than 5 weeks reached on Monday, thanks to increased holding demand and cautious market sentiment.

However, this reverse relationship is not always absolute. In times of increasing instability such as escalating conflicts or strong market volatility, investors often simultaneously buy both USD and gold to hedge against risks.

Mr. Waterer said: "If there had been no appreciation of the USD since the conflict escalated, gold could have risen higher than the current level. Inflation concerns are the focus of traders, especially as oil prices rise and traffic through the Strait of Hormuz plummets.

US President Donald Trump declared that he would continue to pursue the military campaign "as long as it is necessary" - while warning of an upcoming "large wave of attacks," but did not elaborate.

Tensions in the Middle East have killed many civilians in Iran, Israel and Lebanon, disrupted global air transport and paralyzed the transport route through the Strait of Hormuz.

On other precious metals markets, spot silver prices rose 0.9% to $90/ounce, after hitting a 4-week high in the previous session. Platinum prices fell 0.39 to $2,296/ounce, while palladium rose 0.28% to $1,767/ounce.