Gold prices skyrocketed because of conflicts in the Middle East

After Hamas' surprise military attack on Israel last weekend, safe-haven demand for gold increased sharply. Thereby, December gold price increased by 18.40 USD, to around 1,863.40 USD/ounce.

Besides, the gold market is also being affected by US macroeconomic data about to be announced this week.

Daniel Pavilonis, senior commodity broker at RJO Futures, said that the upcoming release of US CPI data will show that inflation is starting to weaken and that will be good for gold. Pavilonis predicts that gold prices may increase in the near future.

Meanwhile, Marc Chandler, CEO at Bannockburn Global Forex, said the gold market needs more economic data to confirm the sustainability and clearer direction of the market.

According to Chandler, currently the gold market is still mainly affected by the strength of the USD and bond yields, not the gold purchasing activities of central banks. He believes that gold will have to move above the level of 1,833 - 1,835 USD/ounce to stabilize the current trend.

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