In a new show of just how solid a prospect gold is for investors, the yellow metal has again hit the key psychological price level of £1,297 ($1,800) after a buying opportunity opened up earlier this week.
This key pricing milestone further underlines the resilience and strength of gold as we close in on the end of the year. Gold’s rebound comes as the US dollar again struggles against other currencies. The greenback dipped against key currencies including the Euro yesterday (Thursday).
Uncertainty around what the Federal Reserve might decide around tapering means that there is still a real opportunity to buy right now, as the policy makers mull over a real mixed bag of economic data. Reuters reports, “Gold firmed on Thursday, lifted by a slight retreat in the dollar, but renewed bets that the U.S. Federal Reserve may start early tapering of economic support capped gains, with the European Central Bank also slowing its bond-buying.”
While the decision looms, COVID-19 case rates continue to escalate, which plays in gold’s favour. CNN highlighted the scale of the pandemic right now and the tough decision facing the Federal Reserve, saying “Covid-19 cases have been on the rise in much of the U.S., and the rise in hospitalizations continues in hotspots throughout the country. Children now represent more than a quarter — or 26.8% — of weekly Covid-19 cases nationwide.”