Gold prices maintain a near 9-year high
Tuesday, November 28th 2023
The price of gold has been hovering around the $1800 mark for some time now and it only kept climbing higher over the last week. It hit a peak value of $1817.71 per ounce which is the highest it has been in nearly 9 years.
While some experts feel that gold prices could come down slightly, the difference is going to be almost negligible as prices are expected to stay well north of the $1800 mark for the foreseeable future. Most of the credit for this goes to the possibility of the world already being in the throes of a second wave of the Corona virus.
The associated fear that this harbours could stall the global economy which had started to show some signs of recovery.
The latest statistics paint a grim picture as the number of cases has crossed 12 million globally and the number of deaths stands at a little more than half a million.
42 out of the 50 states in the United States have seen an increase in the number of cases. All of this points to one thing and that is the fact that the pandemic is still far from under control.
This in turn means that most investments are still being seen as risky and safe havens like gold are still very much in demand. Other precious metals also saw a spike in prices as silver reached its highest price in 10-months.
Dollar experiences record lows
Governments around the world are trying to boost their economies into recovery and one way they are doing so is by offering stimulus packages in the billions of dollars.
While it might help with certain issues such as unemployment, it also increases inflation and debases currency. This was evident in the value of the dollar over the last few days as it hit its lowest point in many weeks.
When this happens, the prices of precious metals rise as they offer a hedge against the uncertainties associated with the economy right now. As the dollar value kept plummeting, palladium prices climbed by 1.8% to $1,951.02 per ounce.
Platinum prices rose by 0.9% to $851.23 and Silver too exhibited an upward trajectory of 1.1% to end up at $18.98 per ounce. All of these values are record highs and are in direct correlation to the plummeting dollar.
Unemployment rate to further deteriorate
There is no silver lining yet on the horizon as unemployment rates are expected to keep on increasing. Global trade has decreased due to geopolitical risks and the looming recession is only going to make things worse. The aforementioned stimulus plans used by many nations can offer temporary relief but they could prolong the recovery period in the long run.
As such, the price of gold and other precious metals is expected to scale heights more astronomical than what they achieved over the last week. The only thing that can put an end to this trend is some form of positive data that suggests that the economy is finally on the road of recovery.