Global Geopolitics Heats Up, Pushing Gold Prices Higher

The rising geopolitical temperatures in the Middle East and the Korean Peninsula have driven the price of gold closer to US$1,300 per troy ounce. Bloomberg data shows that on April 13, 2017, the price of gold for the next month's contract closed at US$1,285.9 per troy ounce, representing an 11.55 percent increase from its 2016 closing price. On April 17, 2017, gold was traded at US$1,291.8.

The US military strike on Syria and the escalating tensions on the Korean Peninsula, fueled by North Korea's missile tests, have further boosted the price of gold. Furthermore, the weakening US dollar against major world currencies also contributed to the gold price increase following the Fed's interest rate hike.

Increased global security uncertainty has led investors to once again view gold as a safe haven. On April 17, 2017, the price of one gram of gold bars was sold at Rp 610,000 per gram at Logam Mulia. Meanwhile, 10 grams of gold bars were priced at Rp 5,740,000.