With Today's Election & Market Uncertainty Gold May Be The Safe Play For Now
FinancialNewsMedia.com News Commentary
PALM BEACH, Florida, Nov. 3, 2020 /PRNewswire/ -- In uncertain economic times, investors tend to put their money in gold. So it's perhaps little surprise that gold prices started to rise at the beginning of the year as the coronavirus started spreading in China and Europe and investors feared a global economic downturn. Gold prices have soared so far this year and many analysts predict gold will top $2,000. Gold usually rises alongside investors' uncertainty in the economy. It's a "safe haven" for investors who want to hedge their bets against a falling dollar and instability in financial markets, and, as long as investors are still unsure about the health of the market, they'll continue putting money into gold. Justin Waring, a strategist at UBS Global Wealth Management, says financial markets are unlikely to stabilize until a coronavirus vaccine is widely available. Markets will remain volatile "until we have a clearer understanding of when the economy can get back to 'normal,' " he said. Active stocks in the mining markets this week include QMC Quantum Minerals Corp., (TSX-V: QMC) (OTCPK: QMCQF), B2Gold Corp. (NYSE: BTG) (TSX: BTO), Almaden Minerals Ltd. (NYSE: AAU) (TSX: AMM), Barrick Gold Corporation (NYSE: GOLD) (TSX: ABX), Kinross Gold Corporation (NYSE: KGC) (TSX: K).
A report from Transparency Market Research said that: "Due to the escalating prices of gold, it is at present being oversold in the bearish market. In times of high inflation, currency fluctuations, and geopolitical crisis, gold is considered to be the safest investment… the growth of the global gold market is likely to be driven by the rising prices of gold across the world." It continued saying: "The purchase of gold is expected to rise as consumers are focusing on long-term investments. As the confidence over bullion as a secure mode of investment is rising, the demand for gold is also rising at a considerable rate. The global gold market is likely to be affected by the fluctuating supply of mined gold as the global gold production is a mix of scrap recovery, central bank supply, and mined gold. More than half of the global gold supply comes from mined gold." And as long as that uncertainty continues, gold prices could keep rising, analysts said.
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