empty
17.12.2020 02:07 PM
Gold hits peak of its popularity again

This image is no longer relevant

Today, prices in the precious metal market continue moving upwards. Such a surge was triggered by the increasing US dollar weakness. The greenback fell even deeper after the publication of the Fed's meeting results. As most analysts had expected the US economic situation is still alarming. It needs emergency measures and support.

Early today, at the New York exchange, gold futures with February delivery rose by 0.65% or $12.15 to settle at $1,871.25 per troy ounce.

At the same time, silver futures with March delivery advanced even at a faster pace than gold. Thus, in the morning, silver prices jumped by 1.8% to $25.503 per troy ounce.

A drop in the US national currency was the main driver of the rise in gold prices. Just after the publication of the Fed's meeting results, the US dollar slumped to the lows last reached in the middle of spring in 2018. As a rule, depreciating dollar supports gold. This could be explained by the fact that gold becomes more available to residents of other regions, where investors perform deals using another currency.

Moreover, the US regulator decided to keep the key interest rate at the same level around 0-0.25%. Notably, the benchmark rate is likely to remain extremely low for a long time. According to preliminary estimates, the key rates will be the same for the next three years. The Fed is also planning to keep the asset purchase program at the size of $120 billion a month. This process will take place until there are clear signs of the labor market and inflation recovery in the US. Of course, gold is gaining in value amid such decisions and market participants are benefiting from this.

Moreover, there is an opinion that stimulus measures, which will be implemented in the near future, are not enough. It is time to think over additional support tools. Fed's Chair Jerome Powell hints that the US Congress should increase the financial aid. Of course, the US dollar will fall amid such actions, but gold will confidently grow.

Most analysts believe that the greenback will remain in a difficult situation even in the next year. It may lose about 10% of its value. In this case, market participants have nothing to do but switch to such safe haven assets as gold. As a result, gold prices may soar to $1,900 per troy ounce and move even higher to the important level of $2,000 per troy ounce. According to some economists, gold may reach these readings as early as the middle of the upcoming year.

Maria Shablon,
Analytical expert of InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST

Recommended Stories

Markets on roller coaster: Dow plummets, gold rallying, Trump keeps investors on edge

The changes in Wall Street indices for the last 24 hours: the S&P 500 fell by 0.23%, the Nasdaq rose by 0.10%, and the Dow dropped by 0.91%. The S&P

12:25 2025-04-08 UTC+2

US Market News Digest for April 8

The Trump administration's latest wave of tariffs is reshaping economic expectations. Goldman Sachs is now forecasting a recession within the next 12 months, while JPMorgan analysts are pricing

Ekaterina Kiseleva 12:14 2025-04-08 UTC+2

Markets in turmoil: Dow plunges, gold surges, Trump adds tension

US stock indexes closed lower on Monday, after a session full of sharp swings. Investors are wary of signs of an economic slowdown and a surge in inflation risks, exacerbated

Thomas Frank 08:39 2025-04-08 UTC+2

Trade War: S&P 500 Plunges 3%, Nikkei 6% as Investors Brace for Worst

Wall Street Futures Open Sharply Lower Investors fear a U.S. recession amid escalating trade war. Trump Announces Massive Tariffs on Key Trading Partners S&P 500 Futures Lose More Than 3%

Thomas Frank 11:59 2025-04-07 UTC+2

US Market News Digest for April 7

On April 7, futures on the S&P 500 index approached the key support level of 4,953. Holding above this zone could pave the way for a rebound targeting 5,100

Ekaterina Kiseleva 11:42 2025-04-07 UTC+2

US vs. Everyone: Trump Tariffs Crash Markets from Wall Street to Europe

US stock markets crashed on Thursday, posting their most painful daily losses in years, as Donald Trump's unexpected and aggressive tariff maneuver unleashed a wave of panic on global markets

Thomas Frank 12:09 2025-04-04 UTC+2

US Market News Digest for April 4

Markets tumbled after Donald Trump announced new import tariffs, triggering a widespread sell-off across US stocks. The Dow, NASDAQ, and S&P 500 all posted significant losses. The pressure on equities

Ekaterina Kiseleva 10:55 2025-04-04 UTC+2

US Market News Digest for April 03

Futures plunge after new tariffs: Nike and Boeing hit hardest. Fear index rises US stock markets opened April sharply in the red. Donald Trump announced an increase in tariffs

Irina Maksimova 13:24 2025-04-03 UTC+2

Markets on edge as Trump imposes 10% tariff on imports, gold and euro soar

Trump announces 10% basic tariff on all imports in keynote speech Gold at record high, yen jumps, bonds rise Indices rise ahead of speech: Dow 0.56%, S&P 500 0.67%, Nasdaq

Thomas Frank 10:55 2025-04-03 UTC+2

$10 billion: cost of mistake. J&J again under spotlight

Balance sheet indicators are in turmoil. Airline stocks are falling. J&J is also sliding. Big gains for recent IPO names CoreWeave and Newsmax. Indices: Dow down 0.03%, S&P

14:26 2025-04-02 UTC+2
Can't speak right now?
Ask your question in the chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.