Gold: high demand due to the market crisis [γράφημα] – financial postman

Analysts and international houses expect gold to rise towards $2,500/oz levels. Concern about the banking crisis in the US and Europe after the collapse of the Silicon Valley Bank (SVB) and the compulsory takeover of Credit Suisse by UBS has shifted more towards gold, which in the past few days has reached the psychological level of 2000 euros per ounce. Since March 10, when the SVB passed into state administration, gold prices have increased by 10%.

This financial crisis came on top of concerns about the war in Ukraine, which has already caused major central banks such as those of Turkey, Russia, China and Kazakhstan to frantically buy the precious metal, sending its prices soaring. In 2022, gold demand is at an 11-year high due to demand from central banks according to the World Gold Council. Last year alone, central banks bought 1,135 tons of the precious metal, the largest amount in 55 years.

Gold rediscovers its “magic”.

Gold prices hit an all-time high in August 2020 amid the pandemic, with prices reaching $2,075 an ounce.

Fitch Ratings now expects gold “over the next few weeks” to reach these levels again in a bid to break the record $2,075 level. Analysts who spoke to CNBC from companies such as CMC Markets estimate that a larger rally is possible with prices near $2,500 an ounce. Wheaton Precious Metals, which specializes in precious metals, is making a similar prediction.

The role of interest rates

MKS Pamp expects gold to rise to $2,200 according to CNBC and that also depends on monetary policy. The Fed now faces the difficult task of choosing between the risks of higher inflation and a deeper recession — the two options that would favor higher gold prices, officials say.

The price of the gold pound in Greece

In Greece, the rise in the price of the precious metal had a significant impact on the buying and selling prices of the gold pound from the Bank of Greece. On March 23, the price offered by Tte for the purchase of 0.9166 (7.940-7.988 grams) old class Elizabeth 1973 and earlier and Elizabeth 1974 and later years was €411.75. The corresponding selling price was 496.18 euros. On February 28, these prices were 389.07 euros for buying from the central bank and 468.90 euros for selling.

Purchases from central banks

Based on the latest data, Turkey bought 23 tons of gold in January, making it the largest buyer of the precious metal among central banks globally during this period. The country now holds 565 tons of gold, the highest level ever recorded, according to data from the World Gold Council.

Overall, central banks around the world added 31 net tons of gold to their holdings in January, increasing their purchases by 16% from December. The People’s Bank of China and the Central Bank of Kazakhstan were the second and third largest buyers of the precious metal, adding 15 tons and 4 tons to their inventories, respectively.

Turkey buys gold as a hedge against very high inflation. Also, not only does the state buy gold there for the same reason, households buy gold as well.