The price of gold has shattered so many price records in recent years that it's almost become commonplace. Up by more than 90% since June 2020, gold has become much more expensive to invest in for beginners, and much more lucrative for those who have already added the yellow metal as part of a small but critical part of a diversified portfolio. Both investor types, however, have a vested interest in where the price of gold is heading, both long-term and in the immediate days and weeks.

Beginners, for example, may be eagerly awaiting a minor drop in the market to make their entry. Existing investors, however, may be awaiting yet another hike, which could both boost their portfolio and offer a rare opportunity to sell gold for a quick profit. But which is more likely to occur in the short term? At least for this week (and likely for the rest of June), gold could steadily rise, perhaps even to a new high, past the recent record $3,400 per ounce. However, will that happen this week? The climate could be right for that to occur. Below, we'll explain why.

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Will the price of gold hit a new high this week?

While it's difficult to predict the future price movement of any asset, let alone an alternative one like gold, the climate is right for gold's price to increase yet again, potentially to a new record high. That's largely because this week's inflation report release showed an uptick in the rate for May. While just a 0.1% rise from the 2.3% inflation rate in April, it was a step away from where economists and the Federal Reserve would like to see inflation trending toward. And, historically, when inflation rises, the price of gold tends to rise as well, as investors flock to the precious metal for its safe-haven features. 

And it's already happening.

On Wednesday, the day the Bureau of Labor Statistics released its inflation report, the price of gold per ounce was $3,355.28, according to . But on Thursday, the same amount of gold was selling for $3,382.16, a minor but noticeable uptick in 24 hours. Should additional data or comments made by economic officials indicate wider concern over inflation or interest rate policy, this price could very easily tip into new, record territory. 

Geopolitical tensions, long a historic driver of gold prices, are also elevated right now. Should trade deals come to fruition and tensions overseas subside, gold prices likely will, too. But if one or both deteriorate in the coming days, it could give investors the motivation to increase their gold holdings, spiking the price as a result.

And if you're thinking about the potential for gold prices to fall later in the month, that's unlikely to happen. With the Federal Reserve all but guaranteed to keep interest rates the same in its June meeting, and with rate cuts typically leading to gold price drops but rate pauses generally keeping them where they are, there are few indications that a gold price drop is likely. But, based on the above, a price surge is possible, perhaps as soon as this week.

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The bottom line

Conditions are right for another gold price hike, perhaps as soon as this week, and maybe even past a new record high. That said, prospective investors should still remember the benefits (and limitations) of gold and keep a level and strategic approach toward the precious metal. That means not getting invested (or selling) based on fear, and it means limiting gold to a maximum of 10% of your portfolio to permit other, more reliable income-producing assets, like stocks and bonds, to perform as intended. With the right approach, investors can incorporate gold into their portfolio even at today's elevated price, positioning themselves to benefit from additional price hikes, maybe even in the days ahead.