Gold Prices Hit Highest Level Since 2011
Gold prices topped $1,900 an ounce for the first time since 2011 on July 24, heading for its biggest weekly gain in more than three months, as momentum keeps building from flaring geopolitical tensions and worries over global growth drive demand for safe-haven assets. Spot gold was up 0.6% at $1,900.32 per ounce by noon July 24. Earlier in the day, it had reached an intraday high of $1,906.40 per ounce — its highest level in nine years and about $10 shy of the all-time high. Gold futures for December delivery, which overtook August as the contract with the highest open interest, gained 0.4% to $1,917.40 an ounce after touching a record $1,927.10 during the previous session. Increasing signs that the COVID-19 pandemic will continue to stall economic recovery, and the recent spat between China and the US are underpinning the metal’s appeal. Bullion is also getting support from a weaker U.S. dollar, and expectations of rising inflation amid massive liquidity injections from governments and central banks around the world.“The pace of this
thing is unbelievable,” Bob Haberkorn, senior market strategist at RJO, told Bloomberg in a phone interview. “People just want to buy, buy, buy, they just want to be in — they don’t want to miss it. People are preparing for more money printing, lower dollar in the future and hedging. And there’s no yield on treasuries right now, so gold is a safe spot given the circumstances of the central banks and the coronavirus.” Bob Haberkorn, senior market strategist, RJO Safe-haven assets such as gold tends to benefit from widespread stimulus measures from central banks, as it is perceived as a hedge against inflation and currency debasement. “When interest rates are zero or near zero, then gold is an attractive medium to have because you don’t have to worry about not getting interest on your gold and you see the gold price will rise as uncertainty in the markets are rising,” Mark Mobius, co-founder at Mobius Capital Partners and a long-time gold bull, told Bloomberg. “I would be buying now and continue to buy.” — Mining.com
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