Gold prices have soared to an all-time high of $2,111 per ounce as investors turn to the traditional safe haven asset amid the conflict in Gaza and expectations of a drop in US interest rates. The precious metal, which has been traded since ancient times, carries no credit risk and preserves its value over time due to its rarity. Gold prices have increased by about 13.5% this year, with a 5% gain in the past month alone.
Reasons for the increase
There are several factors driving the increase in gold prices:
US interest rates
Traders are increasingly confident that the US central bank, along with other global central banks, will lower interest rates as inflation eases. If interest rates fall, investors will look for better returns than government bonds can offer, making assets like gold more attractive.
Weakening dollar
Gold is largely priced in dollars and tends to perform better when the dollar weakens. Expectations of rate cuts by the Federal Reserve have caused the value of the dollar to decline, boosting the price of gold.
Global tensions
The conflict in Gaza and ongoing tensions in Ukraine have heightened nervousness among investors. This has led to increased demand for safe-haven assets like gold.
Central bank demand
Central banks have been buying gold at the fastest pace since 1967 in an effort to diversify their financial assets and enhance economic stability.
Impact on consumers
The increase in gold prices is expected to lead to higher prices for gold jewelry. However, consumers in the UK may benefit from trading in their gold, as they can expect to receive more cash compared to last year. For example, a typical customer could receive between £250 and £280, which is £30 more than last year.
Spotify cuts jobs despite Taylor Swift's popularity
Streaming giant Spotify is cutting 1,500 jobs, despite Taylor Swift being the most streamed artist on the platform. The chief executive, Daniel Ek, cited economic slowdown and increased capital costs as reasons for the job cuts. This is the third round of redundancies for the company this year.
Indian monsoon influences gold prices
The monsoon season in India has a significant impact on global gold prices. A good harvest during this time allows farmers, who make up around 60% of gold buyers in India, to spend more on jewelry for their daughters during the winter wedding season. As a result, gold rates typically increase during this period.
Bitcoin reaches two-year high
The price of Bitcoin has surged to its highest level in almost two years. Traders are investing in crypto in the hopes of higher returns if interest rates are lowered by the US Federal Reserve. There are also expectations that regulated exchange traded funds for Bitcoin will be approved, which could help clean up the crypto industry.
Inflation higher for homeowners with children
Official figures show that homeowners with children are facing higher levels of inflation compared to those without kids. The rising cost of mortgages has contributed to an annual inflation rate of 9.3% for homeowners, higher than the rate for renters.
888 Holdings sees shares climb on takeover rumors
Shares of 888 Holdings, the owner of William Hill, rose by 19% amid rumors of a takeover bid. Playtech reportedly made a £700 million offer in July, which was rejected as too low. Investors may pressure the board to restart talks as 888 is now valued at £316 million.
British pension funds hold record low level of UK company shares
British pension funds now hold the lowest level of UK company shares on record. Three decades ago, they held 53% of UK company shares, but that has dwindled to just 1.6%. Overseas investors now own a high of 57.7% of the UK stock market.
Lloyds shareholders could receive £500 million dividend
Lloyds shareholders may receive a £500 million dividend after a debt owed by the Barclay family, owners of the Telegraph, was repaid by an Abu Dhabi investor. Analysts expect the repayment to result in a windfall for investors. The money was repaid by Abu Dhabi-funded RedBird IMI, but the group cannot be controlled until a government probe is completed.
Did you miss our previous article…
https://hellofaread.com/money/bricklayer-goes-from-school-dropout-to-earning-10k-a-month-and-driving-a-sportscar/
