The price of gold hit an all-time high above $1,940 an ounce on Monday as investors seek safe havens from the unfolding Covid-19 pandemic.
Gold was last above $1,900 an ounce in 2011, but then lost traction as the global financial crisis faded and other asset classes began delivering returns. But the Covid-19 pandemic and the uncertainties triggered amid a global economic meltdown have added new sparkle to the precious metal’s status as a “safe haven” – a place to store your money while the storm rages.
Gold’s spot price had been gaining steadily this year and it was only a matter of time before a historic peak would be scaled. Fresh tensions between China and the US provided the latest lift into record territory, bringing its gains in the past 14 months to over 50%.
“The continued demand for a safe haven, it all plays into gold’s strengthening,” Shafali Sachdev, the head of FX Asia at BNP Paribas Wealth Management in Singapore, was quoted as saying by Reuters. “And at this point, there doesn’t seem any obvious factor that could help the trend to draw to a close.”
Indeed, much of the market chatter has $2,000 on the cards…