Gold prices have been on the rise for the past couple of months, and all indications are that this rally won’t be stopping any time soon. Several factors, including geopolitical unrest, increasing inflation and talk of an impending recession, have increased gold’s traditional appeal as a safe haven.
Speaking at a precious metal conference held in Singapore, Silver Bullion Pte founder Gregor Gregersen said that we are in for a duration of stagnation after decades of significant deficit spending coupled with super-loose monetary policy decisions. Although Russia’s invasion of its former ally Ukraine didn’t stop a 10% drop in the price of gold bullion despite the fears of a growing military conflict, top banking officials expect that the incoming period of economic stagnation will favor a bull run for gold. The precious metal’s rally may even see its price reach $2,000 per ounce, they said.
According to Gregersen’s predictions, the price of gold and silver may rise to nearly $2,000 per ounce and $26 per ounce respectively before this year ends. Gold and silver have traditionally been safe havens, and it makes sense to own them now that the global economy is expected to stagnate.
Gregersen said physical assets such as gold and silver are the best to own during an economic downturn and predicted that their prices could even exceed $2,000 and $26 per ounce. Furthermore, he told investors to anticipate unforeseen “black swan incidents.” These are unpredictable situations that are beyond the norm that can have potentially extreme consequences.
On June 7, 2022, gold traded at an estimated $1,840 in London while silver is trading at $21.90 on the Bloomberg Dollar Spot Index. Rhona O’Connell, market analysis head at Stone X Group, said that the gold bullion price is experiencing some resistance at $1,930 per ounce, but once it clears that level, $2,000 per ounce could be achievable via technical trading.
During an interview prior to the conference, O’Connell said that current geopolitical and economic fundamentals favor a gold rally. For starters, the Federal Reserve has accelerated concerns of a recession due to its aggressive monetary policy tightening.
JPMorgan Chase & Co. CEO Jamie Dimon and Goldman Sachs head John Waldron have also issued warnings on the economic risks of inflation as well as the Russia-Ukraine war. With investors constantly receiving news of economic doom, the appeal of gold and silver as stores of value is bound to increase exponentially, and extractors such as Hecla Mining Company (NYSE: HL) will see growing demand for precious metals.
MiningNewsWire (MNW) is a specialized communications platform focused on developments and opportunities in the global resources sector. The company provides (1) access to a network of wire services via NetworkWire to reach all target markets, industries and demographics in the most effective manner possible, (2) article and editorial syndication to 5,000+ news outlets (3), enhanced press release services to ensure maximum impact, (4) social media distribution via the Investor Brand Network (IBN) to nearly 2 million followers, and (5) a full array of corporate communications solutions. As a multifaceted organization with an extensive team of contributing journalists and writers, MNW is uniquely positioned to best serve private and public companies that desire to reach a wide audience of investors, consumers, journalists and the general public. By cutting through the overload of information in today’s market, MNW brings its clients unparalleled visibility, recognition and brand awareness. MNW is where news, content and information converge.
To receive SMS text alerts from MiningNewsWire, text “BigHole” to 888-902-4192 (U.S. Mobile Phones Only)
For more information, please visit https://www.miningnewswire.com
MiningNewsWire is part of the InvestorBrandNetwork.