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Gold prices surged to a record level above $5,500 per ounce on Thursday. Thin market liquidity helped accelerate the rally.
The precious metal gained as investors moved away from sovereign bonds and currencies. At the same time, a weaker US dollar supported demand.
Strong Gains Across Precious Metals
Gold jumped more than 3% during the session. This move followed a sharp rise the previous day, marking the strongest two-day advance in years.
Silver also climbed to a new all-time high. Both metals have recorded strong gains this year as investors seek safety.
Thin Liquidity Increases Volatility
Market analysts say low liquidity played a major role in the rapid price rise. Banks reduced trading activity, which limited market depth.
As a result, prices moved faster than usual. Reduced risk-taking by major institutions also added to volatility.
Technical Factors Boost Momentum
Options market activity may have added pressure to the rally. In particular, traders who sold options rushed to buy futures to hedge exposure.
This process can push prices higher in a short time. It often happens without new physical demand entering the market.
Interest Rate Expectations Support Gold
Traders now expect a shift toward easier monetary policy. Lower interest rates tend to benefit gold because it does not offer yield.
Investors also looked past the latest central bank decision to hold rates steady. Instead, they focused on the chance of future rate cuts.
Currency and Bond Concerns Drive Demand
Concerns over heavy government spending added to demand for gold. A recent selloff in global bond markets raised fears about currency stability.
The weaker dollar made precious metals cheaper for buyers outside the United States. This further supported prices.
Geopolitical Risks Add Support
Rising global tensions also pushed investors toward safe-haven assets. Market uncertainty increased demand for gold and silver.
Analysts say precious metals often perform well during periods of geopolitical stress.
Latest Market Prices
Gold traded near $5,526 per ounce in Asian markets after hitting a record high earlier. Silver remained elevated after its recent surge.
Platinum edged higher, while palladium posted modest losses. Meanwhile, the US dollar index continued to weaken.
Source Attribution
Market data and pricing information confirmed through international financial market reports and global commodities tracking platforms.
