Gold Prices Jump on U.S.-China Tensions, Loose Monetary Policy
Gold Prices Jump on U.S.-China Tensions, Loose Monetary Policy by BEN HERNANDEZ for ETF Trends
Gold prices fueled by Covid-19 uncertainty could give way to geopolitical uncertainty and central bank policy. U.S.-China relations are once again on the rocks while global interest rates remain low, which could both fuel more gold price increases.
“Nobody is talking about this yet but gold is definitely getting a boost from renewed geopolitical uncertainty,” said Phillip Streible, market strategist at Blue Line Futures, via a Kitco News article.
“I think at this point in time the market is likely to continue to see a lot of volatility, but I still believe in the uptrend due to the fact that Jerome Powell almost certainly do whatever it takes to keep the markets relatively loose,” wrote Christopher Lewis in FX Empire. “As long as that is the case, the US dollar will continue to lose value, and thereby people will continue to drive into the precious metals markets. Gold of course is the first place people go to, so it does make quite a bit of sense that we continue to find plenty of opportunities going forward.”
Traders who are sensing an opportunity can play movements in gold via miners using the following funds:
- VanEck Vectors Gold Miners (NYSEArca: GDX): seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the NYSE® Arca Gold Miners Index®. The index is a modified market-capitalization weighted index primarily comprised of publicly traded companies involved in the mining for gold and silver.