Gold close to US$4,000 an ounce

For the first time in history gold has reached almost US$4,000 per ounce as the US dollar has lost 10% of its value since the start of the year, raising the fear of stagflation in the United States.

The increase has been driven by massive buy-ups of gold by central banks amid a tense geopolitical context.

Gold has always been a traditional refuge for investors during times of crisis. To the beginning of October gold increased in value by around 46% – the highest increase since 1979. On Thursday, October 7, it hit a new record at close to US$3,900 per ounce. In September alone the price of golf increased by 11.92%.

Analysts say that gold is one asset that has increased in value in recent months driven by central banks all of the world buying gold as a hedge, particularly in emerging markets looking to reduce their exposure to the falling dollar and a desire to reduce amount of reserves they have in that currency.

Gold is seeing a massive boom driven by fears over the tariff wars, the wars in Ukraine and Gaza, and as such is a refuge and is likely to remain so for some time.

And the Bank of America predicts that the target price of gold will reach US$4,000 for the aforementioned reasons and due to the United States debt crisis as interest on US 10-year treasury bonds hits 4.13% and 30-year treasury bonds 4.71%.

Image: Freepik