This article was last updated on December 4, 2023
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Factors Contributing to Record High Gold Prices
Gold has never been so valuable. Just before midnight, the price of the precious metal briefly rose to 2,135 dollars (1,966 euros) per troy ounce, which corresponds to 31.1 grams. This has more than broken the record of 2075 dollars (approximately 1910 euros) from the corona period. The price has now dropped back to around $2065.
The price of gold has been rising for weeks. First of all, the geopolitical tensions resulting from the war between Israel and Hamas led to a lot of unrest on the stock market. People often look for a stable investment such as gold, driving up its demand and price.
According to Johan de Ruiter, director of Goud Exchange Office, the fact that inflation has been very high for some time also plays a role. “The price of gold generally rises nicely with inflation, so people use gold as a way to keep their wealth from evaporating during times of high inflation.”
Speculations about Interest Rate Cuts
Moreover, interest rates in the United States are expected to fall. Speculation about interest rate cuts leads to expectations of a weaker dollar. A weaker dollar makes gold cheaper for buyers with other currencies, leading to more demand and higher gold prices.