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A key question for big investors and savings As the world enters a period of shadow where the real investment criteria disappear, investors invest in secure channels, while guaranteeing the return of their wealth.
Investors now doubt traditional channels generating money: the financial market bubble is at its peak and they are aware that the rise in Wall Street indices does not mean a real recovery of the economy, but an artificial recovery. Oscillating on the edge of the recession.
Investors are aware that the continued recovery of the Wall Street market, the largest financial market in the world with a market capitalization of $ 27 trillion, was caused by cheap liquidity injection policies and buyback operations of companies.
The price of homes and apartments previously used by large investors as savings to protect their erosional heritage also collapse in many major financial centers, collapsing in London, Miami and Vancouver. In addition to the low yields of the savings holders on their accounts in commercial banks.
Thus, wealthy people are now trapped. According to many precious metal experts, gold seems to have a real chance of exceeding the $ 1,500 ounce. In this regard,
The World Gold Council (WGC) said in its semiannual report for 2019 that several factors were supporting the rise in the price of gold this year and until the second half of next year.
These factors include uncertainty about the direction of global stock exchanges, which have continued to increase over the past three years and still remain. The interest rate and quantitative easing policies currently being adopted by central banks, under the leadership of the Federal Reserve, are the second most important factor in raising the price of gold. .
This policy could trigger a currency war on the global foreign exchange market, valued at around $ 4.5 trillion a year, and could lead to the reduction of countries' currency values in order to automatically increase the competitiveness of exports at the expense of cash.
The Sino-US trade wars, in which presidents Xi Jinping and Trump exchange accusations and seek to win them with all the tools of money, including the devaluation of the dollar and the yuan, constitute the third factor to the Origin of soaring price of gold.
This factor increases turbulence on the financial markets and the war of costs reduces the volume of world trade. The fourth factor influencing is the tendency of global central banks to buy gold, especially the banks of countries under US embargo and prohibited from dealing with the dollar or those who fear the risk of the dollar for their economy.
In the first quarter of 2019, central banks bought a record 715.7 tonnes of gold, the World Gold Council announced.
China's gold reserves rose from 600 tons at the end of 2005 to 1852 tons at the end of 2018, becoming the sixth largest gold reserve in the world, China said in its latest official data released on Tuesday. It is known that China is gradually increasing its purchases of gold in order to liberalize the exchange rate of the yuan and to convert it from local currency into world currency. China also has investments in US Treasury bonds estimated at $ 1,117 billion, which it seeks to gradually reduce.
According to data from Russia's central bank, in April Russia added 274 tonnes of metal to its reserves in 2018, bringing its total gold reserves to 2,113 tonnes.
Add to that,? Investors also have other reasons for wanting to buy gold, including the decline in global gold production in South Africa, which ranks as the second largest producer country in the world. gold in Africa after Ghana.
The increase in global debt also threatens global trade in closed-end instruments and could cause bankruptcy for many countries unable to cope with their debts like Argentina. However, one of the most important factors that determine the evolution of commodity markets in the world, mainly gold, is the US interest rate and the exchange rate dollar, gold moving in a direction opposite to that of the dollar.
President Trump's "America First" policy and the huge spending on defense have the effect of increasing US public debt and fueling geopolitical tensions.
In London's precious metals market, gold prices fell on Tuesday as the dollar reached its highest level in two months, as investors waited for a two-day meeting of the US Federal Reserve, which is expected to reduce interest rates by a quarter of a percentage point. During the morning session, spot gold fell 0.3% to $ 1,422.85 an ounce. US gold futures also rose $ 1423.90 an ounce.
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