Gold rates increase to historic high
Date
9/18/2024 8:44:51 AM
(MENAFN) On Friday, Gold prices surged to an unprecedented peak, surpassing USD2,600 per ounce, driven by a growing wave of demand from global investors seeking safe-haven assets. Spot gold prices climbed 1.13percent to hit a record high of USD2,609.8 per ounce before settling slightly lower. This week's gains have propelled gold prices up by approximately 4 percent, marking a remarkable 23percent increase since the beginning of the year, far outpacing the 13percent rise recorded throughout all of 2023.
The dramatic price rally has been fueled by recent reports suggesting that the United States Federal Reserve may be poised to cut interest rates by 50 basis points in the coming week, lowering rates from their current range of 5.25percent to 5.50 percent. This represents the highest interest level since 2001, and lower borrowing costs tend to enhance the appeal of gold, which does not yield interest.
Analysts attribute the surge in gold prices to heightened investor interest in safe-haven assets amidst a backdrop of global uncertainty and escalating geopolitical tensions in regions such as the Middle East and Eastern Europe. Historically, gold has been a go-to investment during turbulent times, serving as a hedge against risks and a reliable store of value. For millennia, bullion has been regarded as a safeguard during periods of economic instability, stock market downturns, military conflicts, and even pandemics.
In addition to increasing demand, the recent decline in the value of the US dollar has contributed to gold's rise. The greenback has fallen to its lowest level this year against a basket of other currencies, partly in anticipation of the Federal Reserve's potential interest rate cuts.
Looking ahead, analysts at Bank of America have made bold predictions, estimating that gold prices could soar to as much as USD3,000 per ounce within the next 12 to 18 months.
Other precious metals also experienced gains on Friday, with platinum rising 2.36percent to surpass USD1,000 per ounce, while silver climbed 3.3 percent, breaching the USD31 mark. As the global economic landscape remains fraught with uncertainty, the surge in gold prices reflects a collective movement among investors prioritizing security and stability in their portfolios.
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