Gold Breaks All-Time Record!
Gold broke through $1,900 on Friday morning and kept pushing upward, setting an all-time record during Asian trading hours on Monday.
Gold was trading as high as $1,944 an ounce early Monday.
The previous record price for gold came in the third quarter of 2011 at just over $1,920 an ounce.
Gold’s climb has been steep and fast. It was just a couple of weeks ago that we reported gold breaking through the $1,800 resistance level.
There are a number of factors driving gold higher. There is a strong safe-haven bid with a surge of coronavirus cases in many areas. There are also increasing geopolitical tensions with China. In a speech late last week, Secretary of State Mike Pompeo used rhetoric reminiscent of the Cold War. He depicted China’s leaders as tyrants bent on global hegemony. “If the free world doesn’t change Communist China, Communist China will change us,” he declared. “If we bend the knee now, our children’s children may be at the mercy of the CCP, whose actions are the primary challenge to the free world.”
There also seems to be growing awareness that the promised quick “v-shaped” recovery will never materialize. The economic data just doesn’t support it. We’ve reported on the rise in mortgages delinquencies, the rising number of permanent businesses shutdowns, the number of small business owners who don’t think they’ll survive, the increasing number of over-leveraged zombie companies, and the tsunami of defaults and bankruptcies on the horizon.
Dollar weakness is also helping drive the yellow metal higher. Early Monday, the greenback fell to a four-month low against the yen and a 22-month low against the euro. The dollar index fell to nearly-2-year lows around 94.60 Friday and continued its drop in early trading Monday, falling to 93.82.