GOLD PRICE: WE'VE GOT IT. NOMINAL RECORD BROKEN!

Author of the entry: Mennica Skarbowa
Date of entry: July 29, 2020

The new week brought historically high gold prices on the stock exchange. On Monday morning, the price of gold exceeded the magic barrier set in 2011 and reached $1,927 per ounce. The gold market is experiencing a boom, which, according to many analysts, may continue for a long time.

At the end of last week, many speculated that we would see the historically high gold price barrier broken. We are talking about September 2011, when one ounce cost US$1,921. On Friday, the price of gold was USD 30 lower than that amount. Everyone waited with bated breath to see if this was the moment when the price of gold would skyrocket.

It turned out that the new week brought record high prices. Monday morning proved that the impossible is becoming reality – the nine-year-old record was broken. The price per ounce reached $1,927.

BULL MARKET

This long-term trend and golden age for gold began last year. At that time, many analysts assumed that a correction was imminent. However, this has yet to happen. For now, the crisis caused by the coronavirus pandemic is strengthening the position of the precious metal. It is worth noting that the rise in gold prices cannot be analyzed in isolation from what we are generally seeing on global markets. The success of the metal is largely correlated with the weakening position of the dollar, in which gold is priced.

What is more, the risk of price inflation, which was avoided after 2008, has now increased significantly. According to many, we are facing a real monetary hurricane, as central banks have decided to print more money in order to save national economies. This affects gold prices and prompts many investors to look for alternative ways to invest their capital.

This morning, the price of gold soared again, reaching $1,958 per ounce. In the United States, Citibank analysts predict that the price of gold will rise to as much as $2,300 per ounce within a year. Bank of America, on the other hand, expects the price of gold to rise to as much as $3,000 per ounce over the next 18 months.

Analyzing the previous year and what this year has already brought us, the forecasts of American banks do not seem to be a vision straight out of science fiction movies. All we can do is closely monitor the gold market and think about diversifying our investment portfolio.