For the first time since August 2014, gold has breached the $1,300 per ounce “barrier.” What does this mean? Can it continue?
Lance Roberts, who helps oversee $600 million as chief strategist for STA Wealth in Houston, says it’s still too early to tell if gold is on an uptrend. “What has changed over the past few months is that fear is coming back. Some investors are buying gold to hedge against uncertainties.”
Essentially, investors are seeking safe bets amid worldwide economic turmoil: ongoing troubles in Ukraine, political uncertainty in Greece, the Swiss National Bank’s move to remove the peg against the Euro, etc. All of this is creating speculation that governments will implement new stimulus measures to counter economic stagnation. Meanwhile, investors are predicting (or fearing) that any growth won’t be enough to offset weakness in foreign economies and currencies. Since gold is widely considered a safe investment, demand is up, and so are prices.
With all this in mind, gold is likely to see stable or increased prices in the immediate future. As always, you can watch these price trends develop, and compare them to previous trends, by looking at our gold price charts.