Gold hits record high of $4,500 as global tensions fuel safe-haven demand

Gold prices surged to a record high of $4,525.96 per ounce Wednesday, December 24, amid rising global tensions and looming U.S. war against Venezuela.

The precious metal’s price has increased around 72 percent on an annual basis and this surge also created a trickle-down effect as prices of other precious metals have also increased.

Silver price also reached a historic high of $72.2 per ounce, marking an increase of 144 percent on an annual basis.

Experts attributed the surge to better-than-expected growth rate of the United States (U.S.) economy in the third quarter of the year. The U.S. GDP exceeded market expectations and grew by 4.3 percent in the third quarter of the fiscal year.

Another major contributing factor to the increase in gold value is central banks’ decision to buy gold for boosting reserves amid rising geopolitical tensions involving Venezuela.

The U.S. has carried out a strong military buildup in the Caribbean and is continuously demanding Venezuelan President Nicolas Maduro to step down. Trump administration has called it “anti-drug trafficking campaign.”

The sharp rise in gold and silver prices shows growing concern among investors as global tensions continue to rise.

Many are turning to precious metals as a safe option during uncertain times. With geopolitical risks and economic developments still unfolding, market watchers believe prices may remain volatile in the coming days.