Investors look to gold amid growing uncertainty

The world gold price has increased sharply after the increase in oil and gas prices – Photo: REUTERS

According to Bloomberg News, the price of gold on April 18 increased 1% after the price of oil and gas increased. As of 8:30 a.m. on April 19, spot gold listed on Kitco precious metals was sold at about $1,976 per ounce, slightly down from the April 18 peak of $2,000 per ounce.

Bloomberg noted that bullion for June delivery rose 0.6 percent to $1,986.40 an ounce on Comex.

The possibility that the European Union actually embargoes Russian gas, as well as the threat of oil supply shortages arising from the European sanctions package, has pushed up prices of these two commodities. By 9:00 am on April 19, the price of US light sweet crude oil (WTI) had decreased by 0.5%, to 107.70 USD/barrel.

These fluctuations also make investors look to gold as a backup option.

Gold prices have maintained their highs in recent days even as yields on 10-year US Treasuries edged higher. Bloomberg said that investors are still waiting for more information on whether the US Federal Reserve (FED) will raise interest rates in May.

“Gold prices are being underpinned by rising inflation and geopolitical risks,” said Kelvin Wong, an analyst at financial services firm CMC Markets (Singapore).

According to him, the fact that the price of gold has risen above 1,975 USD/ounce, which is predicted by investors to be difficult to overcome, will continue to attract investors to this precious metal.