Gold price rises to highest level in almost a yearGold price rises to highest level in almost a year
The turbulence in the banking sector is causing the price of gold to rise. It gained more than $100 per troy ounce of the precious metal this week alone.
In view of the uncertainty on the financial markets, investors are increasingly turning to gold as an investment. The price of gold rose during the day to its highest level since last April. In the late afternoon, a troy ounce of the precious metal - around 31.1 grams - was trading at 1,965 US dollars on the London Stock Exchange. That is around 2.3 percent more than in the morning. In the past week, the price of gold rose by more than 100 dollars.
Calculated in euros, the price also increased significantly. Most recently, an ounce cost 1,842 euros.
As an investment, gold is considered to be crisis-proof. However, consumer advocates also warn of sometimes severe price fluctuations. The consumer advice center NRW therefore recommends investing at most a small proportion of one's assets in gold.
The background to the current rise in the price of gold is the crisis affecting the regional banks in the USA. The Silicon Valley Bank collapsed there a week ago after customers had withdrawn their deposits en masse. The First Republic Bank had to be supported by eleven major banks with 30 billion dollars. In addition, Credit Suisse is struggling with a loss of confidence among investors and customers.
Barbara Lambrecht, precious metals expert at Commerzbank, said how the price of gold will continue to develop depends primarily on the next interest rate decision by the US Federal Reserve. The US Federal Reserve will announce its decision on Wednesday. "If the situation on the market has calmed down by then and the Fed at the same time identify further need
for action to combat inflation, gold is likely to give back some of its recent gains," she said. We anticipate a rapid climb to $2100 an ounce.