(Reuters) - Gold prices rose on Monday as escalating Iran-Israel tensions boosted safe-haven demand, with markets closely monitoring developments in the region.
Spot gold gained 0.4% at $3,382.42 an ounce, as of 0145 p.m. EDT (1745 GMT). U.S. gold futures settled 0.3% higher at $3,395.
"Prices are up partly because of political uncertainty following the U.S. bombing of Iran," said Jeffrey Christian, managing partner of CPM Group.
The United States over the weekend launched multiple missile strikes against Iran targeting its nuclear sites, while President Donald Trump openly mused about overthrowing the Iranian government.
Axios, citing an Israeli official, reported on Monday that Iran had launched six missiles toward U.S. bases in Qatar.
Israel's military bombed Evin prison in northern Tehran, a potent symbol of Iran's governing system, in what Israel called its most intense bombing yet of the Iranian capital.
Gold is traditionally seen as a hedge against inflation and a safe haven during times of uncertainty.
"We expect gold and silver prices to remain strong and to rise further as long as the political and economic problems continue and we don't see them ending anytime soon. Our expectation is that the price of gold could hit $3,500/oz within the next couple months," Christian added.
Gold hit its highest-ever mark on April 22 at $3,500.05.
Investors also await the U.S. Personal Consumption Expenditures data due later this week.
Last week, the Federal Reserve left the U.S. policy rate in its current 4.25%-4.50% range with policymakers hinting at possible rate cuts later this year.
Bullion, a non-yielding asset, tends to thrive when interest rates are low.
Spot silver was up 0.7% at $36.23 per ounce and platinum rose 2% to $1,290.31.
Palladium added 3.1% to $1,076.50, reaching its highest level since June 11.
(Reporting by Sarah Qureshi in Bengaluru; Editing by Shailesh Kuber, Leroy Leo and Tasim Zahid)
By Sarah Qureshi
