Gold surges to highest levels since 2013! Gold surges and goldbugs rejoice as rising tensions in the Middle East has created a demand for traditional safe havens. Goldman Sachs Group Inc. sees more room for Gold to run – Palladium is following closely by.
The Gold Bullion is nearing $1,600 an ounce after Tehran said it would no longer abide by the historic deal brokered in 2015. They announced this following the killing of General Qassem Soleimani. President Trump has said that he is prepared to strike Iran “in a disproportionate manner” if the Iranian state retaliates against any US target.
According to Goldman analysts, Gold may prove to be a better bet than oil amid rising tensions.
“History shows that under most outcomes gold will likely rally to well beyond current levels… consistent with our previous research, which shows that being long gold is a better hedge to such geopolitical risks” says Jeffrey Currie and Damien Courvalin in a note.
Spot gold climbed as much as 2.3% to $1,588.13 an ounce on Monday, the highest since April of 2013, and traded at $1,566.93 at 2:07 PM in New York. JPMorgan Chase & Co. analysts expect that an extension of the rally to $1,655 is “highly likely,” whereas a break below $1,531.22 could lead to a setback.
Gold has had a run since 2010 – when the US – China trade war’s caused a drag on global growth. Easier monetary policy across the world’s leading economies also fueled the rapid growth of Gold in the early 2010’s.
Palladium has also moved higher over the last two weeks – the conflict between Washington and Tehran seems to be a significant factor. Silver has also advanced to $18.5081 an ounce, the highest since September 25th of last year.