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Global crises push gold prices to nine-month highs

The crisis currency gold is highly sought after yesterday. In the morning, the price of a troy ounce (about 31 grams) of the precious metal rose to $ 1,309. This is the highest level since June 2018. Since last summer, gold has risen by nearly $ 150, or about 12 percent.

Experts explain the gold strength with two factors. On the one hand, the high level of uncertainty due to political developments has recently risen again. This week alone, there will be two important events with a decisive Brexit vote in the British Parliament and new negotiations on the US-Chinese trade conflict. Add to that the political crisis in Venezuela and the escalating conflict between the US and the Chinese telecom giant Huawei.

The second gold supporting factor is developments on the financial markets. Thus, the US dollar stock market chart has tended to weaken recently. This makes gold, which is traded in the US currency, more favorable to many interested parties, which in turn stimulates gold demand.

Gold can also profit from decreasing interest rate expectations to the US Federal Reserve. Thus it is assumed that the Fed will signal a wait-and-see attitude this Wednesday following its interest rate decision. The main reason is the weakening global economy.