The price of gold, considered a safe haven for investors in times of crisis, surpassed the $4,000 per ounce mark this Wednesday, amid political tensions in the United States and France. Economists had predicted the $4,000 mark would only be reached in 2026.
Gold reached $4,001.11 per ounce at 3:00 a.m. (Lisbon time) at the start of Asian trading.
Gold reached new highs amid the partial shutdown of the US federal government, while in France, President Emmanuel Macron decided to give interim Prime Minister Sébastien Lecornu until today to negotiate "a platform for action" that will help the country break out of its current political impasse.
This year, gold has appreciated 49%, driven by massive central bank purchases, a weak dollar, and the geopolitical context.
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A few weeks ago, it was at $3,700, now it's at $4,000, an 8% increase.
China is not only making massive gold purchases, dumping dollars and bonds, but is also using the Shanghai Gold Exchange to force central banks of friendly countries that buy bullion to store it within its borders.
The vulnerability of the private banking system has not only not diminished but has increased (primarily because central banks have refused to impose conditions on banks that would limit it). The possibility of a new, severe financial crisis is seen as very real, which also leads to an increase in gold hoarding by investors. It is known that gold yields higher returns in times of economic turmoil and crisis.
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