Gold Reaches Highest-Ever Price as Economic Uncertainty Deepens

During times of global instability, gold traditionally shines as a safe haven for investors. Over the last 12 months, the price of this precious metal has increased by almost one-third, exceeding $3,550 an ounce a couple of days ago. 

Much of this demand is driven by investors seeking security, some of whom are primarily investing in gold by buying bullion in the form of coins, ingots, jewelry or bars. This isn’t for everyone though, as others prefer to trade financial products instead. 

Here, the focus is on exchange-traded funds that track the precious metal’s price and the buying selling of gold futures. Futures are basically contracts to sell or purchase the precious metal at a particular price. A benefit to financial products is that investors don’t have to physically store or handle large quantities of gold, which many seem to prefer. 

The surge has been fueled by a combination of economic and geopolitical shocks, including the invasion of Ukraine by Russia, Israel’s ongoing offensive in Gaza and President Trump’s trade war. Trump, in particular, has played an outsized role in recent movements. How, you may ask? 

Well, we know that gold has an inverse relationship with the U.S. dollar, which means that when the value of the greenback reduces, that of the precious metal rises. Earlier this year when he announced his liberation day tariffs, he unleashed a wave of instability in global trade prospects, which saw the metal’s price rise to new highs. 

More recently, his criticism of the Federal Reserve’s independence, his call for the central bank to lower interest rates to boost economic growth and his preference for a weaker dollar to make U.S. exports more competitive has further boosted demand. 

Senior financial market analyst Kyle Rodda, notes that these situations make the precious metal even more attractive to investors. This, he explains, is because reduced interest rates make it more attractive to hold gold, which also applies to other assets that bear interest like bonds. This volatility also encourages investors trading in foreign currencies to purchase more of the precious metal as the greenback’s value declines, as they get to enjoy increased purchasing power.   

Beyond U.S. politics, global demand is also rising. 

Several governments are increasing gold reserves as a hedge against inflation and as a store of value, especially as confidence in U.S. government bonds continues to erode. All these factors together underscore one reality; that as economic and geopolitical uncertainty deepens, gold remains the ultimate refuge to investors and governments alike. 

As investor interest in gold rises, gold exploration companies like Torr Metals Inc. (TSX.V: TMET) are well positioned to attract additional capital injections via stock exchanges. 

NOTE TO INVESTORS: The latest news and updates relating to Torr Metals Inc. (TSX.V: TMET) are available in the company’s newsroom at https://ibn.fm/TMET 

About MiningNewsWire

MiningNewsWire (“MNW”) is a specialized communications platform with a focus on developments and opportunities in the Global Mining and Resources sectors. It is one of 70+ brands within the Dynamic Brand Portfolio @ IBN that delivers: (1) access to a vast network of wire solutions via InvestorWire to efficiently and effectively reach a myriad of target markets, demographics and diverse industries; (2) article and editorial syndication to 5,000+ outlets; (3) enhanced press release enhancement to ensure maximum impact; (4) social media distribution via IBN to millions of social media followers; and (5) a full array of tailored corporate communications solutions. With broad reach and a seasoned team of contributing journalists and writers, MNW is uniquely positioned to best serve private and public companies that want to reach a wide audience of investors, influencers, consumers, journalists and the general public. By cutting through the overload of information in today’s market, MNW brings its clients unparalleled recognition and brand awareness.

MNW is where breaking news, insightful content and actionable information converge.

To receive SMS alerts from MiningNewsWire, text “BigHole” to 888-902-4192 (U.S. Mobile Phones Only)

For more information, please visit https://www.MiningNewsWire.com

Please see full terms of use and disclaimers on the MiningNewsWire website applicable to all content provided by MNW, wherever published or re-published: https://www.MiningNewsWire.com/Disclaimer

MiningNewsWire
Los Angeles, CA
www.MiningNewsWire.com
310.299.1717 Office
Editor@MiningNewsWire.com

MiningNewsWire is powered by IBN