Gold is trying to break new records by the middle of this month, and its efforts did not end in nothing. Based on the observations of analysts, gold's quote is rising for the second session in a row, which is not the limit. Therefore, they expect this precious metal to further grow.
Moreover, several experts believe that the decline in the yield of US government bonds and the prospects for a new stimulus package in the US primarily supports the yellow metal. Last night, its quotes soared near the previously reached two-week highs. The strong volatility of the US dollar and lower yields on Treasury bonds made the indicated metal more attractive. So today, gold tried to maintain its position, trading near $ 1861– $ 1862 per ounce.
According to experts, the rally in gold prices reached its peak after the US labor market published its report. It should be recalled that the indicator for the third quarter of 2020, showing the level of labor productivity outside of US agriculture, was revised down (to +4.6%) from the previous +4.9%. Based on technical analysis, gold's quotes have broken through the key level of $ 1850 per ounce, which was recently considered the nearest support. This is the last time "gold" quotes surprised the market with a noticeable increase, quickly recovering from a short-term decline. The reduction in real interest rates and the total weakening of the US currency also contributed to this growth.
However, experts were recently concerned about the precious metals market due to a particular matter – the recent massive capital outflow from the "gold" exchange-traded funds (ETF). This was facilitated by factors such as a surge of liquidity, expectations of additional stimulus from the ECB and the Fed, and hopes for the early introduction of effective vaccines against COVID-19. As a result of such a policy, gold unfortunately lost its advantages temporarily.
Most analysts estimate that the monetary policy (MP) of the leading central banks will remain soft next year. Experts are sure that this situation is good for the gold, and it will try to reach new levels and conquer them. At the moment, the yellow metal is set to reach this target, aiming for its largest annual growth in a decade. An invaluable support is provided by massive monetary stimulus aimed at fighting the COVID-19 pandemic.
