Instability in the Middle East and tensions surrounding ships flying the American flag support the gold market

Geopolitical tensions in the Middle East are rapidly increasing demand among investors for safe-haven assets. Recent reports indicate that Iran launched drone attacks targeting the U.S. Navy’s USS Abraham Lincoln aircraft carrier, and there have been multiple incidents where U.S.-flagged commercial ships avoided forced stops by Iranian armed boats.

As these conflicts escalate, gold prices have rebounded from declines, leading to a reassessment of the investment value of precious metals. OCBC Bank’s foreign exchange strategists note in a research report that the fundamental support factors for the precious metals market remain robust. Rising geopolitical risks, increasing debt burdens across countries, and uncertainty over U.S. policy outlooks continue to drive demand for diversified investments across multiple asset classes, with particular interest in traditional store-of-value assets like gold growing.