The price of gold has rocketed this week, with three strong consecutive days of growth leading the precious metal to outperform the commodities sector.
Hitting a three-month high on Tuesday 4 June at $1,327.9 per troy ounce, investors have continued to buy into exchange-traded and physical gold pushing up prices as demand soars.
Inflows into the world’s largest gold ETF, the SPDR Gold Trust, rose by 2% on Monday and marked its biggest one-day gain since 2016, the Financial Times reported as part of a wider inflow that bought holdings in gold-backed ETFs to their highest in a year.
The reason investors are ploughing their money into gold is clear: they are motivated by a strong desire to hedge against weakness in global equity markets and uncertainty about the future of trade relations between the U.S. and China, according to reports from DailyFX.
Following a survey of regional economic conditions, the commodities market is slowing while gold is on the up suggesting the U.S. economy is reflecting signs of a now 15-month slowdown in global growth.
Experts from Metal Miner commented: “With the interest-rate-induced dollar weakening, with the accompanying possibility of higher inflation, would be a boost to gold. The Fed monetary easing has already been factored into the market and, in part, gold’s rise has reflected that.”