Gold back above $1,300 per ounce

We haven't seen gold prices like this since September last year. Last week, gold prices fluctuated wildly, but after the weekend, investors clearly showed that breaking through the psychological barrier of $1,300 per ounce was just the beginning of a price rally.

After Friday's eagerly awaited speech by Fed Chair Janet Yellen, in which she did not even mention monetary policy, and the prospect of another US interest rate hike this year began to fade, all eyes turned to Mario Draghi.

During the central bankers' summit in Jackson Hole, the head of the European Central Bank stated that the ECB's loose monetary policy is working, although he did not comment on the current state of the eurozone economy. It did not take long for the euro to strengthen against the dollar, with the EUR/USD pair reaching its highest level in over 2.5 years.

Gold also benefited from the weakness of the dollar, but the real price increases were yet to come after the weekend. Monday was a public holiday in the UK, which affected market liquidity, but on Tuesday morning, the price of gold skyrocketed, breaking through the $1,320 per ounce level.

The current price – approx. $1,325/oz – is the highest since September last year. In PLN terms, due to the exceptionally weak dollar (the USD/PLN exchange rate is the lowest in over two years!), an ounce of gold still remains below PLN 4,700 per ounce, which clearly encourages Polish investors to buy.

MW