The golden rally in the markets is at its best. Just look at the statistics to see the scale of growth: the value of the ore has increased by 9 percent over the past three weeks and by as much as 37 percent from the beginning of this year. The price of gold, as an investment foundation, is driven not only by concerns about inflation in the United States, but also by growing public debt, which makes dollar assets such as the American currency, lose their attractiveness as a stable form of storage of value.
The last dynamics of gold prices was particularly noticeable. A week ago it exceeded the threshold of $ 3,500, and the latest record is the result of the weaker data from the US market. On this basis, investors assume that at the next Federal Reserve meeting a decision will be made to reduce interest rates by at least a quarter of a percentage point. Some financial market players bet even a more significant reduction – half a point.
Chris Turner, the global director of market research in ING, emphasized that the expectations of changes in the Fed monetary policy have still strengthened the position of gold as “universal inflation protection.” In an interview with the media, he added that investors are beginning to predict a more significant loosening of monetary policy, launched by the FED in response to growing inflation. Turner noticed that real interest rates, i.e. those corrected with the value of inflation, have a good chance to return below zero, which may promote a further increase in gold prices.
Will record prices of gold persist? It will come to the answer, but one thing is certain: more and more investors are turning their eyes to the ore, which seems to be one of the most stable options in more and more uncertain times.
