Gold price forecast: Gulf crisis and weak dollar set to boost precious metal

Investors have flocked to the precious metal over the past week, as the Gulf Crisis sees the rifts between Middle East countries growing.

The weakened dollar has also heaped provide values with a lift.

Gold prices are now at around $1,256 but could easily hit $1,260 and move towards $1,290 seen at the start of June, according to forecasts.

It comes as Saudi Arabia and its allies have issued a list of demands to Qatar, which stipulate that Doha must cut ties with Iran ad  close down a Turkish base among other requests.

It’s feared that a rejection by Qatar could further inflame the regional crisis.

Investors traditionally head for gold during times of political and market turmoil, with the metal considered a safe house for cash.

David Madden, market analyst at CMC Markets UK said: “Gold is on the rise after it endured losses for most of the month.

“Throughout 2017, the metal has been in an upward trend, and it would appear that this is a continuation of the wider bullish move.

“The short sellers got out of the market before the metal reached the 200-day moving average – $1238.

“The metal has rallied for the past three sessions and it is now approaching $1260.

“The US central bank said they will keep tightening their monetary policy, but traders are not yet convinced that they will be as hawkish as they are letting on.”