Andrew Naylor, regional CEO of the World Gold Council (WGC), acknowledges that this year’s rally in gold was partly driven by geopolitical events. Nevertheless, from his perspective, the upward trend in gold has already been manifesting since 2020, in the midst of the pandemic.
As surging commodity prices, supply chain disruptions and rising interest rates continue lead to record inflation figures, investors are flocking to gold — shining a light on the yellow metal’s role as a hedging tool, safe haven and risk mitigator. ”Weakness in global equity prices added to the appeal of gold as a favoured asset in inflationary times,” according to Phillip Nova’s senior commodities manager Avtar Sandu in a market commentary.
The precious metal was trading at just above US$1,800 ($2,437) per ounce at the start of the year. However, triggered by demand for safe haven assets following Russia’s invasion of Ukraine, gold prices hit US$2,052 on March 8, although it has since eased slightly to around US$1,918 per ounce as at April 6. “The gold market had been resilient with investors patiently buying the dips,” adds Sandu.
