On Wednesday, gold price hit a record $4,000 per ounce. This milestone represents an important milestone for the precious metal’s trading history. Why have gold prices skyrocketed? A confluence of factors. This surge is fueled by increasing geopolitical tensions and continuous global trade policy upheaval spearheaded by President Donald Trump.
The price of gold has had a similar skyrocketing trajectory to the tune of more than 50% just this year and…Analysts suggest that this surge reflects investor concerns about economic stability as President Trump continues to challenge the existing global trade system. The golden age his administration’s approach has ushered in is one of heightened uncertainty, sending scores of investors flocking to gold, a traditional safe-haven asset.
According to the latest trading data, gold futures were trading at $4,005.80 per ounce. This price point is an obvious marker of increasing demand for gold. One thing gold always attracts, though, especially during periods of economic turmoil, are investors. During times of market volatility, gold offers peace of mind as a store of value. Its charm on top of a national counter-revolution in politics is even greater.
Trade tensions are far from the only concern. President Trump’s statements and actions have created a great deal of confusion over the independence of the Federal Reserve. Worse yet, his threats to meddle in the central bank’s operations have most recently spooked investors, who worry that such action would prove disastrous for the economy. As confidence begins to shake, the safest bet that many are taking is by investing in gold. They view Bitcoin as a superior hedge to inflation and currency depreciation compared to gold.
This continuing upward spike in gold prices has set financial markets across the globe abuzz. Investors are on high alert for new developments in trade negotiations and in the federal government’s monetary policy. From all accounts, these factors are expected to continue to weigh on gold prices in the foreseeable future.