Gold whizzes above $2,400 as commodities catch fire
Gold prices are continuing their upward trend, and with the decisive break above $2,400 per ounce, analysts and traders are wondering how high the yellow metal can run in the current environment. Adam Button, head of currency strategy at Forexlive.com, said that this recent move is a continuation of the broader rally, and it’s being driven by the same source.
“This rally started in China, and China continues to show up,” he said, adding that recent data show Turkey and much of the Middle East are also buying bullion. Button noted that this week’s meeting between Russian President Vladimir Putin and Chinese Premier Xi Jinping is also very bullish for gold prices.
“If you’re a gold bull the picture of Xi and Putin hugging is as good as it gets,” he said. “They’re trying to create a multipolar world, and you can’t do that if you’re relying on the dollar.”
The combination of high inflation, massive debt issuance, and runaway central bank currency printing is pushing market participants into precious metals and other commodities. Experts said that they can’t imagine a better situation for gold prices to go higher.
“It’s a perfect storm of bullishness,” Paul Hloben said. “You have geopolitical worries. You had the pandemic. And what does our government do right after that? Prints more for all these funding projects that really haven’t started yet. Now you’re in a campaign year, so all those things, as they relate to gold, just create more uncertainties on the back end, and that’s why you continue to run here.”
“It just goes back to the old adage, any time we create more of something, it’s worth less.”
“Silver’s also caught fire here, copper’s caught fire as an industrial metal, platinum. It’s really been a hell of a ride. You can make an argument that crude’s underperformed, still up a little over 10 on the year, nothing crazy, but if that gets going that’s going to bring everything else up.”
