Gold at a 7-year high on economic concerns 

#GS3 #Econony 

Fed stimulus also propels prices 

  • Gold prices rose to a more than seven-year high on rising fears of a steeper economic downturn and amid massive liquidity measures undertaken by global central banks. 
  • Spot gold gained 0.6% to $1,724.72 per ounce by 1.34 p.m. IST , having touched its highest since November 2012 at $1,726.85 earlier in the session. U.S. gold futures rose 0.6% to $1,772.20. 
  • Liquidity (from the Federal Reserve) combined with the background of lower interest rates makes gold a much more attractive proposition. 
  • Reflecting appetite for bullion, holdings in SPDR Gold Trust, the world's largest gold-backed exchange-traded fund (ETF), rose 1.6% to 1,009.7 tonnes on Monday, the highest since June 2013. 

Safe haven 

  • Gold as a safe-haven has gained traction as currencies are being devalued by massive stimulus programs. 
  • This has also increased physical demand of gold (such as ETFs) to hedge against the debasement of fiat currencies. 
  • Silver gained 0.6% to $15.54 while platinum was up 2.5% to $766.70. 
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