Gold Price Nears $2,000 Again—With New Records In Sight
The price of gold is likely to top the $2,000-per-ounce benchmark for the second time this week—and some predict the yellow metal is on a trajectory to top its past records.
At press time, gold’s spot price was $1,994 an ounce.
Analyst predictions for gold now range from $2,200 to as high as $2,600 an ounce. Goldman Sachs has raised its 12-month gold price target to $2,050 an ounce from $1,950, according to Reuters.
“It’s very plausible that we see a strong performance in gold over the coming months,” Craig Erlam, a senior market analyst at foreign exchange company Oanda, told CNBC. “The stars appear to be aligning for gold which could see it break new highs before long.”
Analysts said that the current gold rush is caused by investors being unsettled by the recent series of high-profile bank failures, and once again fleeing to the “safe haven” of gold.
“Concerns about systemic risks to bank deposits—whether warranted or not—may lead to investors moving some of their currency holdings into gold,” said John Reade, chief market strategist for the World Gold Council, on that group’s site.
In addition, analysts believe that the bank issues will likely make the Federal Reserve more “dovish” on interest rates. On March 22, chairman Jerome Powell said “we no longer state that ongoing rate increases will be needed to quell inflation.”
Added Reade: “A lower ceiling for interest rates is gold-friendly too, limiting the opportunity cost of holding gold.”
Gold hit its all-time high—$2,067 an ounce—in August 2020, during the COVID-19 pandemic.