Quote of the Day
Gold surged to a new record on Tuesday, as geopolitical tensions and interest rate speculation drove a rally in the yellow metal.
The commodity rose to as high $2,141.79 per ounce, eclipsing its December all-time high of $2,135.39, according to Bloomberg data.
…
Gold’s rise is in part due to its safe-haven status, which investors are increasingly seeking out amid ongoing international turmoil. With the Ukraine war and the Gaza Strip conflict still raging, the asset’s spot price has risen 3.2% year-to-date.
But the metal saw a much sharper increase since mid-February, and has added around $100 in the past week.
Filip De Mott
March 5, 2024
Gold Price Hits New All-Time High on Rate-Cut Hopes, Geopolitical Turmoil (businessinsider.com)
That was March 5th. This is the last 24 hours (as of about 9:00 PM PDT):
The all time high referenced in the article has been eclipsed by nearly 6% with the all time high of yesterday morning and yet a new one this morning ($2,268.26).
Gold is either outpacing inflation or inflation is much greater than the Fed is telling us.
I would think that in general gold should be essentially in sync with inflation.
I’ve been asking people, chat bots, and reading articles trying to find a reason I am satisfied with which would account for the rapid rise in the price of gold relative to the dollar in the last month. Nothing is particularly convincing. The following are in the order I find most likely to least likely:
- China is buying gold.
- Non-U.S. markets are doing poorly.
- Fighting in Gaza.
- War in Ukraine.
- Speculation the Federal Reserve will cut interest rates in the coming months.
- People are concerned Trump will win the election and are buying gold because of the chaos he will bring.
Unless China is buying at a greater rate than previously none of those things are new in the last month.
See also:
- What Is the Highest Price of Gold Ever Recorded?(goldalliance.com)
- Will Gold’s Record-High Rally Continue? (goldalliance.com)
- Why Did Gold Prices Hit All-Time Highs? (investopedia.com)
- Gold Hits Another High—Despite A Strong Stock Market And Economy. Here’s Why. (forbes.com)
Prepare appropriately.