(Bloomberg) — Gold prices fell after hitting a new record high amid tensions in the Middle East and the upcoming U.S. presidential election.

Most read by Bloomberg

Gold prices rose as much as 0.7% before declining as some investors booked profits following the precious metal’s four-day winning streak. Last week it broke $2,700 an ounce, with analysts attributing the gains to safe-haven demand amid uncertainty over the outcome of the US election and ongoing worries over the Middle East. Israel has discussed its attack on Iran after a Hezbollah drone exploded near Prime Minister Benjamin Netanyahu’s private home over the weekend.

Silver rose as much as 1.7% on Monday to its highest level since 2012 before giving back those gains.

Gold has hit several all-time highs in recent months and is up more than 30% this year. In addition to shelter-in-place demand and US political uncertainty, the rally was fueled by robust central bank buying and expectations of US interest rate cuts. Lower interest rates are often viewed as bullish for non-interest bearing gold.

“The simple bottom line is that gold thrives on uncertainty,” said Rhona O’Connell, head of EMEA and Asia market analysis at StoneX. “The lack of clarity about the medium-term direction of US foreign policy increases nervousness.”

Meanwhile, asset managers increased their net-long positions in gold while investors added to their holdings in exchange-traded funds in recent sessions. SPDR Gold Shares, the world’s largest precious metals-backed ETF, posted its largest weekly inflow since March. Gold futures could rise to an average of $3,000 in the fourth quarter of 2025, Commonwealth Bank of Australia analyst Vivek Dhar said in a note.

See also: European gold miners rise as Haven Metal hits new record

The spot gold price was $2,721.31 an ounce at 4:42 p.m. in London. The Bloomberg Dollar Spot Index and the 10-year U.S. Treasury yield rose. Palladium and platinum fell.

–With support from Sybilla Gross.

Most read by Bloomberg Businessweek

©2024 Bloomberg LP