Buyers and sellers of gold received good news this past week as gold hit an all-time high for the last seven weeks. The spot price of gold hit $1280.60 per ounce. The gold price closed at $1277.61 at the end of the week, which was up by 9% on its last closing price.
This past week, gold has gone up by a total of 3.5%. This is gold’s best performance since the start of February 2016. Silver has also received similar good fortune, as it reached the highest price since way back in January 2015.
The reason why more investors have made their way towards the precious metal market is because of the weak performance of both the stock markets and the declining value of the dollar. With gold always being priced in dollars, it means that investors are gaining value through switching to the previous metals market
With the increasing volatility of the stock markets, investors once again see gold as a haven for their money until the danger passes.
One of the main reasons for the decline of the stock market recently is the Bank of Japan. The bank said that it would not expand its monetary stimulus scheme. As the stock market saw a mini crash, gold prices crept up, and there are no signs that this trend is going to avert in the near future.
Another decision that has pushed up gold prices is the US Federal Reserve’s choice to leave interest rates unchanged on Wednesday. Every time the US Federal Reserve refuses to raise interest rates, market confidence is shaken. It demonstrates that the economy is not growing like it should.
This has shaken investor confidence and forced them to move more towards the precious metals market.
In time, the stock markets will recover from these two hammer blows, but gold prices are largely expected to remain high for the foreseeable future. This would allow current holders of gold to make large gains if they decide to sell before the economy recovers.
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