Gold is touching sky high valuations and breaking records on a day to day basis. It is defying the years long understood negative correlation between Fed Rate and Gold prices. I am sure all of you must have come across various factors driving this rally but if I were to simply state them in a few bullet points: - Gold's status as the reserve metal of the world Institutional Push: - Geopolitical tensions driving the incessant gold purchasing of Central Banks - Reducing Exposure to Dollar Retail Push (also true for Institutional): - Hedge against Inflation Why would it continue: Rising Geopolitical tensions prompting countries and investors to look for safe haven assets. Thus, institutional demand for gold, driven by Central Bank is not going to subside as they are not at all price sensitive (evident by the PBC, RBI, CBRT etc.). Add to that a little sprinkle of polarisation and the de-dollarisation efforts. Would love to hear from you guys on any point that I might have missed. Cheers! #gold #markets
Completely agree! Gold's status historically, in an era where economic fluctuations and geopolitical tensions can unsettle even the most composed investor, will always be a solid long-term investment.
MSc SDS at University of Oxford | DL Enthusiast
7moGold has without a shadow of doubt been a choice for countries irrespective of political agenda and alignment. I strongly agree with the facts stated above, however I believe countries producing/mining (selling) gold will also be forced to reckon with geopolitical burdens. For example Australia has reduce exporting its gold freely to China and Chinese allies, the way it used to, leading to decline in China's gold imports. In this case a geopolitical issue (south china sea conflict) did cause repercussions on Gold.