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The price of gold has reached a record high of over $ 4,000 (2,985 British pounds), as investors are looking for safe places to put their money because of fears about economic and political uncertainty around the world.
GOLD has seen its largest rally since the 70s of the last century, rising by about a third since April since April, when US President Donald Trump has announced tariffs that upset global trade.
Analysts say, Excluding the US government He enters his second week.
Gold is seen as a so -called safe asylum investment, which is expected to maintain or increase its value during market turbulence or economic downturns.
The price of spot gold – the real -time market value of precious metal for immediate delivery – has risen to over $ 4.036 an ounce on Wednesday afternoon in Asia.
Gold Futures – which serve as a gauge for market sentiment – reached the same level on October 7th. Futures are agreements for the purchase or sale of the assets on a predetermined date in the future.
The exclusion of the US government, which was triggered by repeated public spending, is a “queue for gold prices,” said Christopher Wong of OCBC, who is a bank strategist based in Singapore.
Investors have focused on assets of safe asylum like gold during previous US government stops.
It increased by nearly 4% during the monthly stop in Trump’s first term in the White House.
But gold prices can fall if the stopping ends faster than some investors expect, said G -n Wong.
Gold’s “unprecedented rally” over the past month exceeded the expectations of analysts, said UOB Bank Heng Koon’s Markets Strategy.
He added that the rise was also bound by weakening of US dollars And more non-professional buyers, known as retail investors, buy gold.
Not all who invest in gold buy physical precious metal.
Some investors invest their money into financial products, such as stock -traded funds (ETFS), supported by gold.
A record $ 64 billion has been invested in Golden ETF so far this year, according to the World Golden Council Commercial Association.
Gregor Gregson, founder of the Precious Metals merchant and Silver Bullion storage provider, said he had seen customers wear more than double in the last year.
Retail investors, banks and wealthy families are increasingly targeting gold, considering it as a precaution against global economic uncertainty, he said.
“Most of our customers are long-term owners,” Mr Gregersen added, explaining that most of his customers have kept their gold for more than four years.
“Gold will fall at some point, but I believe that given the economic environment, it’s in an ascending trend for at least five years,” he said.
As the G -n Gregersen emphasized, the prices of gold are falling as well as they are increasing.
Its price can be reduced if there is an increase in interest rates or geopolitical tensions and political uncertainty, said OCBC.
For example, in April, the price of gold fell by about 6%after Trump gave up the dismissal of Fed Jerome Powell’s chair, he said.
“Gold is often seen as a hedge against uncertainty, but hedging can be unbuttoned.”
And in 2022, Gold’s The value is immersed from 2000 to $ 1600 per ounce after the US Central Bank raised interest rates to limit the inflation caused by the Covid-19 pandemic Hen.
A major risk of Gold’s current rally is the sudden resumption of inflation, which can encourage the Federal Reserve to increase the rates, he added.
The recent climbing of gold prices reflects the expectations that the Fed will reduce interest, which makes gold more attractive, said G -n Wong.
In the meantime, Trump has increased the pressure on the Fed, publicly criticizing G -N -Powell that he has not reduced enough quickly and tried to fire Fed Lisa Cook Governor.
The director of the President of the Fed can “undermine confidence in (her) ability to act as a reliable, inflation-focused central bank,” said Mr Wong.
In such an environment, Gold’s role as a hedge against uncertainty is “renewed,” he said.
