Gold prices jumped to all-time highs for the third straight trading session. This increase is driven by a flood of investor demand from across the Chinese mainland. The largest jump, $600 million, was seen during Asian trading hours. As tensions rise between China and the United States, investors are seeking out gold as a “stateless” asset to avoid retaliation.
In fact, for the first time, gold futures traded in New York recently crossed above $3,400 per troy ounce. At one time, they actually reached a staggering $3,440. This landmark mood further cements gold’s stature as the go-to safe-haven investment. As a result, investors are flocking to gold, the ultimate long-term store of value, especially during turbulent geopolitical times.
A significant number of these funds moved from a neutral position to one of actively purchasing gold over the Easter holiday weekend. This move continued to fuel gold prices upward. That last Asia comment speaks to an unprecedented bout of precious metal demand in the Asian market. In China’s Shanghai market, gold spot prices were $51 per troy ounce higher than in London at times. This price differential highlights the feverish demand for gold in China and belief in its stability.
Increasing strain in China-US relations is adding a wild card to world markets. With economic uncertainty on the rise, investors are flocking to gold to protect their wealth. Gold is a rallying cry for many Chinese investors. They consider it a shrewd and safe investment to make in these economically turbulent times.
The continued ascent of gold prices highlights the metal’s enduring appeal as a protective asset during periods of market volatility. With today’s trading patterns, demand for gold as a safe haven has proven to be strong and will continue to be sturdy as geopolitical uncertainties loom.