On Monday 4th December 2023, the price of gold reached an all-time high. The reasons are attributed to the weakening of the dollar and investors’ expectation that central banks will begin lowering interest rates soon.
One troy ounce of gold cost $2,111 on Monday, the highest price in history. The previous high was set in August 2020, when gold was priced at $2,072.49 per troy ounce.
However, gold’s price did not remain at an all-time high for long, falling back to $2,064 per troy ounce. One troy ounce weighs about 31.19 grammes.
The corona pandemic forced investors to look for a safer asset class to invest their savings, which caused the gold price to peak in 2020.
When central banks began purchasing gold at the end of last year, the price of gold rose.
Furthermore, geopolitical tensions related to Russia’s war against Ukraine aided the rise in gold prices. This increased demand helped the price of the precious metal rise despite rising interest rates. Typically, when interest rates rise, the price of gold falls because, unlike securities, investing in gold does not generate interest income.
Gold is now rising further as inflation in the United States falls and investors expect the Federal Reserve to cut interest rates soon. Over the last month, the dollar has also lost ground against a number of other major currencies, including the euro.