Last Friday, gold prices hit their highest level since September 2012, at $1,762 and reaching record highs in many other currencies.
Gold prices were seen storming back towards their mid-Aril highs, with investor appetite up amid sustained market volatility.
Gold’s rise is amazing in that Japan and Europe are deep in a recession with their stock markets tanking, and the U.S. is just entering a recession, with most other major asset classes falling – except gold.
Gold prices settled higher Wednesday for a second session, as economic stimulus measures boosted demand for the precious metal against the backdrop of economies attempting to reopen from the COVID-19 pandemic giving bullion dealers in India some hope.
Precious metals gained after Fed Chair Powell’s bearish comments. Federal Reserve Chairman Jerome Powell told lawmakers the Fed was looking at extending access to the credit facilities to additional borrowers, including states with smaller populations.
The Senate committee was warned by the head of the central bank that the current downturn is considerably worse than any recession since World War II and that long-term unemployment could damage the economy.
This means that the path to economic recovery will extremely difficult and slow says RSBL. Which is why, he reiterated his commitment to use a full range of tools to support the economy, including leaving interest rates near zero until the economy is back on track. This saw safe haven buying remain strong, with gold prices pushing back towards USD1,750/oz. This will surely brig about a rally in gold prices, which was already being witnessed during this week which looks promising for top gold dealer in India.
Furthermore, demand for insurance against heightened uncertainty could help sustain the recent upward move in gold prices, and duly has revised its forward price projections. Here’s also a now-famous prediction of Bank of America for $3,000 gold by the end of 2021, with their equally famous four-word response to the printing-press paper profusion: “Fed Can’t Print Gold.”
A renewed outbreak of COVID-19 in Northwest China rattled investors. Authorities have subsequently reinstated lockdown measures for 108m people in provinces, including Jilin and Liaoning
Elevated uncertainties linked to the flood of liquidity into the financial system and the increase in global debt, coupled with elevated geopolitical uncertainties, may further increase safe-haven demand for gold says RiddiSiddhi Bullions Limited.