Gold’s acceleration through the $3,000 barrier has brought the yellow metal back to the front pages of financial newspapers and magazines in recent weeks. While there was an initial dip after first breaking through, gold now stands higher than $3,070, and has continued to perform strongly amidst uncertainty surrounding tariffs and the future of global trade. In truth, gold has spent much of the past five years in the headlines.
The lockdowns put in place in response to COVID-19 saw gold’s true value as a safe haven asset during Black Swan events proven to investors who had previously dismissed the notion of holding hard physical assets. Since then, a flood of new investors have entered the market for precious metals, with Central Banks joining in the buying spree.
The true measure of gold’s centrality to the global financial system is the pace at which it is breaking through major milestones as it rises. Gold first broke through the $1,000 mark in March 2008 during the banking crisis – gold also rallied in recent years when Silicon Valley Bank and Credit Suisse collapsed. While it took more than twelve years for gold to break $2,000, it took less than three years for gold to rally a further $1,000 to break through the $3,000 barrier in recent weeks. With $3,100 now in sight, one may wonder if the yellow metal will reach $4,000 in an even shorter time.
Gold’s recent rally has been made more notable by happening during a time of high interest rates, which are generally viewed as unfavourable to the gold price. Historically, gold tends to rally as rates are reduced, meaning there could be further upside ahead. Gold’s true value as an inflation hedge could be tested in the months and years ahead as tariffs (which are inflationary) are potentially raised between the US and Europe.
Merrion Gold is an Irish-owned and operated business that offers unrivalled expertise in the precious metals arena. Merrion Gold accepts all major currencies, including Euro, US Dollar, Sterling and Australian Dollar.
Merrion Gold holds a wide range of gold bars on stock for immediate collection, ranging in a variety of sizes from 1 gram to 1KG. Silver, platinum and palladium bars are also available for immediate collection.
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