The prospect that interest rates might have peaked is powering gold prices to record highs. It also marks a switch from recent years, when rising real yields weighed on gold prices, disappointing those who had touted the metal’s potential as protection against the spike in inflation. Another factor powering 2020 prices’ recent climb is a recent rush to gold by many of the world’s central banks. “The structural price floor for gold is higher," said Doshi, “and central banks are a big part of that story." Steel added that recycling rates have jumped in places like India when prices reached $1,900 an ounce, with more consumers looking to cash in on the high gold prices.

Source: Wall Street Journal December 06, 2023 04:07 UTC