Gold Prices extend the rally

Mar 29, 2023 thejournalbiz

The most actively traded gold futures contract has added more than 7%

Reaching the threshold $1,973.50 a troy ounce this month, on pace for the largest monthly percentage gain since November 2022.

Nervous investors have rushed to gold after the collapse of Silicon Valley Bank and Signature Bank spurred fears that a banking crisis could drag the economy into recession.

Tweet on a gold rally

Gold added more than 7% to $1,973.50 a troy ounce this month, on pace for the largest monthly percentage gain since November 2022.

Investors rushed to gold after the collapse of Silicon Valley Bank and Signature Bank spurred fears of recession.#Gold #recession #BankingCrisis pic.twitter.com/dUJFZuZg0A

— The_Journalbiz (@the_journalbiz) March 29, 2023

Factset chart on Gold

Some investors believe that gold prices could shoot even higher. Trey Reik, the managing member at Bristol Gold Group, said he expects prices to trade at about $2,500 by the end of the summer if the Federal Reserve pauses its aggressive interest-rate increase campaign.

The latest gains have been fueled by nervous investors sheltering in the haven after the collapse of Silicon Valley Bank and Signature Bank spurred fears that a banking crisis could drag the economy into recession.

At the same time, investors rush to safer investments has driven down yields on government debt, increasing the relative appeal of gold, which doesn’t offer bonds’ regular payouts. The slide in yields has also slightly weakened the dollar, making gold—which is priced in dollars—less expensive for overseas investors.