(Bloomberg) -- Gold gained the most in two weeks as traders sought safety in the precious metal after Israel struck Beirut’s suburbs in response to a weekend attack.
Israel’s military struck Beirut, aiming at a Hezbollah commander, following a rocket attack on Saturday in the Golan Heights that killed 12 people. The Israel Defense Forces said it targeted “the commander responsible for the murder of the children in Majdal Shams and the killing of numerous additional Israeli civilians.” Israel blamed the Lebanon-based militant group for the weekend attack.
Bullion rose as much as 1.1%, the biggest intraday increase since July 16. Investors typically flock to bullion in times of geopolitical and economic risks.
The precious metal wavered earlier Tuesday as traders parsed through fresh US data while awaiting a flurry of central-bank events in coming days, including a Federal Reserve policy meeting Wednesday.
Data Tuesday showed US consumer confidence rose in July on an improved outlook for the economy, while job openings in June came in above forecast.
The Fed is expected to hold benchmark rates at the highest level in more than two decades this week, and traders will be closely watching for any hints that the start of policy easing is near. Policymakers in Japan and the UK also meet, with traders watching the Bank of Japan for signs of a hike and the Bank of England for a cut.
Gold hit a record earlier this month as Asian investors ramped up demand for physical bars in the over-the-counter market. It was the precious metal’s best second quarter in data going back at least 25 years, according to the World Gold Council.
November’s US presidential election has also started to spur interest in the precious metal. Gold-backed exchange-traded funds have expanded by about 44 tons in July, putting them on track for the biggest increase in more than two years.
Spot gold was 0.9% higher at $2,406.09 an ounce at 1:28 p.m. in New York. The Bloomberg Dollar Spot Index was little changed. Silver and platinum rose, while palladium declined.
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