Gold achieves historic gains.. Should you invest in it at the present time?

image source, Reuters

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A vendor in the Gold Souk district in Cairo, Egypt, December 8, 2022

  • Author, Marie-Josée Al-Qazzi
  • Role, BBC News Arabic – Beirut

Gold prices rose to a historic level this week, and its price reached $2,179 per ounce on Saturday, making its value rise by an estimated 7 percent within a period not exceeding 30 days.

Economist Amer Al-Shoubaki told the BBC that the current geopolitical risks, with the continuation of the Russian war on Ukraine and the ongoing war in the Middle East, and the expected reduction in interest rates on the dollar in the United States, have all affected the price of gold, which has reached the highest levels in history.

He adds: “With regard to tensions in the Middle East, these circumstances usually push investors to buy gold as a safe means of hedging.”

The economist confirms that expectations of the US Federal Reserve reducing interest rates had “the greatest impact on the price of gold, as the relationship between them is historically inverse. When interest rates are raised, the value of the US currency rises, and this negatively affects the price of gold, causing it to fall, and vice versa.”

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