Gold price shoots up again and is close to its maximum value due to the coronavirus
In the face of uncertainty on the stock markets and in the world markets due to the pandemic, the price of gold is once again on the rise this Monday and has already reached its highest price in the last nine years at $1,820 per ounce. The metal has accumulated a rise of 20% so far this year, due to the outbreak of coronavirus. Investors are returning to safe havens from the devaluation of money as a result of the monetary and fiscal stimuli that have been launched by major central banks and governments to counteract the blow that the coronavirus has dealt to the world economy.
Entities such as Goldman Sachs and Citigroup expect the yellow metal to reach a maximum of 1,911 dollars per ounce in the next twelve months. The investment bank Goldman Sachs assures that the price of this metal can reach 2,000 dollars per ounce if the Federal Reserve does not stop the escalation of the United States. The stimulus measures announced by the European Union are also leading to a rise in the price of the ounce.
Despite the price increases, the industry has also been hit by the pandemic. Gold mines, some refineries and intercontinental transport have been closed to supply demand for this precious metal. South Africa, one of the world's largest producers, was forced to close the Mponeng gold mine, the largest in the world, due to the positive outcome of 164 of its workers and it has not been the only facility affected.
Industry experts point out that demand for this precious material has soared in recent months, but at the same time there has been a lack of supply due to restrictions on extraction, refining and distribution. These two situations favour further increases in the price of the precious metal, which could also affect the price of silver. Demand has been multiplied by its refuge asset value and, at the same time, supply has been restricted due to the impact of COVID-19 on the ore supply chain. This may take the value of gold to unprecedented levels.
Bill Baruch, a commodities analyst at Blue Line Capital, believes that the price of gold may reach $2,000 by the end of the year. Uncertainty in the markets could lead the precious metal to surpass its historical record of September 2011, when the price reached $1,921 per ounce. Bank of America has gone further and predicted that in the next 18 months the metal could reach a price of $3,000 per ounce. Carsten Menke, an analyst with Julius Baer, predicts that the demand for investing in gold will remain as long as the uncertainty lasts, he says in the coming months in the absence of a vaccine.
