Editor’s Note
This article examines the ongoing surge in gold and silver prices, driven by recent turbulence in the US dollar. It explores the factors behind these market fluctuations and outlines expert expectations for the precious metals.
The turbulence in the US dollar is impacting the prices of gold and silver. What is causing the fluctuations – and what experts expect.
Prices for gold and silver are continuing their upward trend after recent turbulence. The price for a troy ounce of gold (about 31.1 grams) rose again last night on the London Metal Exchange to more than 5,000 US dollars. In the morning, the price was at 5,067 dollars, about 122 dollars or roughly 2.5 percent higher than the previous day.
Last Friday and Monday, the gold price had sharply fallen, reaching a low of 4,402 dollars at the beginning of the week, its lowest level in almost four weeks.
One reason for the turbulence in precious metals is the rapid price movements of the US dollar – triggered in part by the conflict between the US government and the US Federal Reserve. Gold and other precious metals are traded internationally in US dollars. This means: the weaker the dollar, the cheaper gold can be purchased with other currencies such as the euro or yen.
Speculators who had bet on even higher metal prices and were caught off guard also contributed to the volatility.
A similar price development was also seen for silver. Here, the troy ounce was traded at 89.20 dollars, about 4 dollars or almost 5 percent higher than the previous day. The silver price had fallen to as low as 71 dollars with the market turbulence on Monday, after reaching a record high of over 121 dollars last Thursday.
Many banks expect a recovery in the gold price. Deutsche Bank reaffirmed its forecast on Monday that the gold price could rise to 6,000 US dollars per ounce over the course of the year. Analysts at the US investment bank Goldman Sachs expect the gold price to reach 5,400 dollars by the end of the year.