The priority of gold as a protective asset has long been obvious to the market. The COVID-19 has boosted interest in the main precious metal, giving its price an additional boost. Silver, on the other hand, also strives to keep up with its "sunny" colleague, encouraging the market with another growth.
Most experts are optimistic about the future prospects for yellow and white metals. First of all, this concerns gold, which has proven itself well during a pandemic. According to James Turk, a major investor and analyst of the precious metals market, a number of fundamental factors testify in favor of further appreciation of gold. Strengthening of the precious metal occurs primarily due to the weakening of the US currency. It can be recalled that gold is in direct correlation with the dollar, and the sinking of the latter gives the precious metal the opportunity to grow. According to J. Turk, the dollar is the last obstacle on the way of gold, but this stronghold will surrender soon.
According to analysts, gold will break new records in relation to major world currencies in the current and subsequent years. According to J. Turk's calculations, the cost of the precious metal will reach $ 1900 per ounce in the near future. Analyst is sure that it will happen after breaking the barrier of $1820. To date, the "solar" metal is confidently approaching the specified level. On Tuesday, July 21, gold is trading near $1818 - $1819 per ounce, testing the nearest levels.
After the pandemic, experts record the rush demand for physical precious metal, which continues. Along with gold, silver also took over the price baton: silver also began to rise in price. According to J. Turk's observations, the ratio of fiat currencies to physical precious metals is crossing all boundaries at the moment. According to the analyst's forecasts, strong cash flow will be poured into key precious metals, that is, gold and silver in the near future.
The supporters of active appreciation of gold and silver are currency strategists of investment bank Citigroup. According to experts, the price of gold denominated in dollars will set a new record - $ 2,000 per ounce in the next three to five months, and it's only a matter of time. Citigroup estimates the probability of such a scenario at 30%. According to analysts' calculations, the rise in "gold" prices is parallel to the rise in "silver", as unrelenting demand for gold supports the interest in silver. As a result, the white metal conquers the next peaks, moving to its highs.
According to preliminary forecasts of Citigroup, the price of silver will reach $ 25 per ounce in the next 12 months. Currently, the "lunar" metal is trading at $ 20 per ounce, with a good chance of soaring to $ 30 if the "bullish" trend continues. Citigroup believes that the recovery of the global economy, "patching holes" after the COVID-19 pandemic, can support silver.
Experts fix the growth of prices for gold and silver for the sixth week in a row, and this is not the limit. The rise in the price of the main precious metals occurs against the background of expectations of additional incentives from global regulators. Another catalyst for the rise of the "solar" and "lunar" metals may be the agreement of a large-scale package of financial assistance from European leaders, who are in the process of negotiations on this issue.
At the same time, political factors continue to actively support the yellow and white metals. The key drivers of price growth remain the soft monetary policy of the leading central banks and very low real interest rates. The positive picture is completed by the monetary "tsunami" directed to the "gold" ETFs. It became the "cherry on the cake" contributing to the further strengthening of the growth of precious metals.