Gold is up 0.9 percent from Thursday to $ 1905 per troy ounce. Since the beginning of this year, yellow metal has risen in price by almost a quarter. Investors consider gold a safe haven in times of uncertainty.
The precious metal now benefits, among other things, from interest rate cuts and other stimulus measures by which central banks are trying to help the economy overcome the negative effects of coronavirus. “Central banks are pumping money into economies to mitigate the negative effects of the coronavirus pandemic. People react to this and buy more gold. With the help of precious metal, they want to protect their savings from devaluation, “explained BHS chief economist Štěpán Křeček. Low interest rates also reduce the disadvantage of gold over interest-bearing investments such as bonds.
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In addition, the demand for gold has now been supported by news that China has ordered the closure of the United States consulate in Chengdu. Beijing has responded to a similar move by Washington, which this week decided to close the Chinese consulate in Houston.
Gold reached an all-time high on September 6, 2011, rising to $ 1,921.18 an ounce. “Given the current trends, it is possible that this limit will be exceeded soon,” Křeček added. “We expect gold to create a new dollar high and then create new historical highs in other currencies,” said consulting firm Wolfe Research.
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