Gold is usually considered a safe investment, as its value is not compromised by inflation. These weeks his price grow significantly. What disturbs the investors so much that mass from stock flee in gold?
When times are insecure and the future gloomy, many people fear for their money. Investors then often react with the same reflex: they are looking for safe investment. Gold retains its value regardless of inflation height, it is certainly for currency reforms and immune to exchange rate fluctuations.
At the beginning of this week (10th February) Fine ounce of gold – which is 31.1 gram – already cost more than $ 2900. Thus, the price of gold has reached the eighth record only this year. Now the psychological important limit of $ 3000 in focus.
London is the most influential market for fast gold store, because there is a “London Bullion Market Association” which since 1919. determines the world market price. Other, less important markets are China, India, the Middle East and the United States.
And in the United States, the search begins for the reasons for the current growth of precious metal prices. As for many other experts, and for Frank Schallenberger, experts for raw materials from Landesbank Baden-Württemberg (LBBW), it is clear who is primarily responsible for it. The main reason for growing the price of gold, he said for DW, certainly lies in the current customs policy of the United States. It creates uncertainty in the financial markets – and that is why gold was requested again as a “secure port”.
The analyst raw materials Carsten Fritsch from Commerzbank agrees: “The most important reason for strong growth in gold is uncertainty about the American President Donald Trump’s customs policy.” For DW, he added that the usual factors like the US dollar and interest rate expectations currently have no significant role in the price growth.
Fears of the global crisis are encouraged and not always credible speculations. On various weeds, the foresight of the American Business Man and the author of Bestseller Robert Kiyosaki are circulating. According to his forecast for ten years, 2025. “massive economic crisis” is expected. It is recommended to rely on self-sufficiency and entrepreneurship and invest primarily in gold, silver and bitcoin.
The Goldman Sachs economists, however, indicate the role of central banks. Gold trade is usually oriented according to key interest rates. In times of low interest rates, investment in tribal metals pays specially. Additionally, there are legal specifics, for example in the German tax system, where investments in physical property is exempt from taxes after twelve months.
For gold there are many stakeholders: private persons who want to provide their property, institutional investors who no longer achieve significant earnings, and park their money in precious metals, but also the national economy. Their central banks, according to the Economist Fritsch from Commerzbank, can encourage price growth with mass purchase of gold.
Concerns about the possibility of introducing financial sanctions are usually the reason for the purchase of gold by central banks. This also applies to developing countries, which fear the negative consequences of the introduction of customs trade, or fear that there will be some kind of collateral damage in conflicts between economic powerful countries. According to the Goldman Sachs survey, the purchase of gold in these countries increased significantly, but after the sanctions introduced by Russia due to invasion of Ukraine.
Will the price of gold soon to reach $ 3,000? Frank Schallenberger is optimistic: “Given that we were only about two percent away from that border, I think it is very likely to be reached soon.”
Already in November, the Goldman Sachs analysts announced the forecast on the movement of the price of gold. They expect growth up to $ 3,000 per ounce by the end of 2025. Years.
The World Gold Council (WGC) industrial association, the lobbying organization of the Mining industry of gold, gives a cautious optimistic image of the near future. “Central banks and in 2025 are expected to have a key role in order to invest even more investors in gold market funds,” Louise Street from the WGC for Manager Magazine. However, poor jewelry demand is likely to continue due to high prices of gold and low economic growth that reduce the purchasing power of the consumer.
The end of growth in price is already in sight, Frank Schallenberger is considered. A profit realization could soon be reached, and during the year, the demand for jewelry, a slight decline in gold coins and golden levers and reduced gold purchases by central banks, which could lead to a drop of gold, said for DW.
His colleague Carsten Fritsch from Commerzbank also provides for the end of Boom: This would contribute to reduced demand for gold in China and India due to high prices. These two countries together make up more than half of private demand for gold. Central banks could also register a medium-term medium term: as the cycling cycling cycle closer to the end, the price will also fall and the price of noble metal.
