Gold and silver markets are once again seeing an uptick in prices amid military tensions between Israel and Iran, global economic uncertainty. The ongoing geopolitical situation has intensified the search for safe havens among investors, resulting in a significant increase in gold demand and prices.
Increasing Gold Prices
The price of gold in the global market increased by $54.02 per ounce, or 1.60 percent, on Saturday (June 14) morning, taking the price of gold to $3,433.47.The previous day, Friday, gold prices had also risen sharply, with spot gold prices at $3,417.10 per ounce. The gold futures market also saw a significant increase, currently at $3,452.80.
From the price record, it is particularly noteworthy that the price of gold reached a high of $3,500 in April this year. Now the price has returned close to that record.
Increasing Silver Prices
Not only gold, but silver prices have also seen a little increase. This morning, the price of silver per ounce increased by $0.09 or 0.25 percent. Currently, the price of silver in the spot market is $36.32 and in the futures market it stands at $36.35.
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Why Prices Increase: Looking for Safe Investment
Investors are once again choosing gold as a ‘safe haven’ amid global political instability and the risk of war. Experts say that the retaliatory military attacks by Israel and Iran have increased market volatility, which has affected investor sentiment. According to analysts, three main factors are contributing to the rise in gold prices:
•Geopolitical tensions (Israel-Iran conflict)
•Uncertainty regarding US Federal Reserve interest rates
•Uncertainty in China-US trade talks
Analysts forecasts
According to global market analysts, gold future prices could temporarily stabilize near $3,444 if the conflict in the Middle East eases somewhat. However, if the conflict intensifies, it is feared that the price of gold could again exceed $3,500.
Interest rates and recession fears
The US Fed’s interest rate decisions, inflation trends, and the price of global trade will play an important role in determining the future price of gold.US investment firm Goldman Sachs recently lowered its risk of a recession in the United States from 35 percent to 30 percent. While this has brought some relief to investors, market volatility remains.
Overall picture of the market
Investors around the world are now in a dilemma. On the one hand, they are turning to gold for a safe haven, while on the other hand, global trade and economic instability is also affecting their decisions.
The Economic Times reports that if the ongoing conflict intensifies, the price of gold in the spot market could exceed $3,500. That is, if political tensions persist, the price could rise further.
In the current geopolitical and economic context, gold has once again become a symbol of safety for investors. If the conflict in the Middle East countries and global monetary policy remains uncertain, the gold market could heat up even more. So it can be an effective risk-reduction strategy for investors, but caution is needed.
Source: The Economic Times
