Gold set for best month in four years after record-breaking gain
Gold is set for the biggest monthly gain in more than four years after a weaker dollar and low rates fueled its surge to a record. Silver headed for its best month since 1979.
Spot bullion is up 10% in July as a gauge of the dollar slumped, prompting concerns its status as the world’s reserve currency of choice is at risk, and US real yields fell to a record low. While the ferocity of gold’s rally cooled as the week wore on, it’s less than $20 shy of its all-time high and most market watchers predict there may be more gains ahead.
The metal has surged almost 30% in 2020, putting it on track for the biggest annual increase in more than a decade, as concern about the fallout from the coronavirus pandemic boosts its appeal as a haven. The Federal Reserve this week repeated a vow to use all its tools to support the US economy, with governments and central banks worldwide already unleashing vast amounts of stimulus to shore up growth.
“There is still plenty of upside left in this rally,” Australia & New Zealand Banking Group said in a note. “The backdrop remains highly conducive, with unwavering support from central banks likely to see monetary easing policies remain in place for the foreseeable future. This will keep bond yields low, raise inflation expectations and potentially keep the US dollar weak.”
Spot gold rose as much as 0.6% to $1 968.79 an ounce and traded at $1,968.16 by 10:16am in Singapore. Prices touched a record $1 981.27 on Tuesday and are up for an eighth week, the longest run of gains since 2006.
With more stimulus on the horizon, Goldman Sachs Group has said that gold is the currency of last resort amid an inflation threat to the dollar. The bank forecasts a rally to $2,300. Bank of America says prices could soar to as high as $3 000 an ounce, while JPMorgan Chase & Co. sees the rally losing steam later this year.
Spot silver advanced 0.6% to $23.629 an ounce to head for an eighth weekly gain. Prices have jumped 30% this month, the biggest increase since 1979.
Comments
Press Office
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation