Tensions between the USA and China and the coronavirus outbreak hit the US dollar. Due to this, prices of major precious metals continue to reach new highs.
Thus, the price of gold has hit a new record for the first time since 2011. Gold rose by 1.57% and reached $1,930.9 per troy ounce. Silver also broke records and increased by 5.87% to $24.07 per ounce.
At the same time, palladium grew by 0.98% to trade at $2,241.03 per ounce, as well as platinum added 1.78% to trade at $930.5 per ounce.
Edward Mayer, an analyst at ED&F Man Capital Markets, noted that people invest heavily in gold amid the weakening the US dollar. The expert also believes that precious metals will continue growing, as the epidemiological situation is becoming worse, while the market expects to receive new great incentives for a long period of time.
By the way, why do prices of silver and gold bullion denominated in both euros and US dollars continue to rise? The fact is that the money supply in the US and in the EU is expanding. For example, the United States is printing money unprecedentedly, and the European Union has approved a €750 billion ($868 billion) Recovery Fund. However, the situation is not that rosy.
When the money supply cannot keep up with the economic growth (which is not seen in the US), the value of the currency inevitably decreases. If money can be printed at any time, the amount of precious metals is limited. Therefore, such a rise in the value of gold and silver was simply caused by the currency devaluation.
