9.4
7.466 Reviews
English
EN
The Gold price broke through €50,000 per kilogram for the first time today. Concerns about the spread of the coronavirus are causing turmoil in the financial markets. With new infections in Italy, Iran and South Korea, the virus is now also starting to spread rapidly outside of China. Investors fear economic damage, as the virus also turns global production chains upside down.
The price of gold shot up more than 2% to €49,700 per kilo at the opening of trading last night. When the European stock markets opened deep in the red, the gold price continued to rise and broke through €50,000 per kilo for the first time in history. That's about €1,550 per troy ounce. The precious metal is benefiting from a global flight to safe havens.
Gold price breaks through €50,000 per kilo for the first time
The price of the precious metal also went up in dollars. Shortly after the opening of trading, the price rose to $1,680 per troy ounce, also more than 2% above last Friday's closing price. The price then dropped back briefly, before rising further to $1,689 per troy ounce in the course of the morning. This is the highest rate in dollars since January 2013.
Also silver benefited from a flight to safe havens. The precious metal rose 1.82% to €557 per kilo, the highest level since its peak in September last year. The precious metal is therefore moving towards the upper end of a range in which it has been trapped for seven years now. Gold and silver are currently moving in locks, so the ratio between the two precious metals continues to fluctuate around 90:1.
Industrial precious metals such as platinum and palladium appear to be less resistant to bad economic news and fell in price. The platinum price fell by half a percent to €28,459 per kilo, while palladium fell by 1.7% to around €79,000. This means that palladium is still twice as high as the level of May last year.
The coronavirus outbreak in Italy is causing a shock reaction in the stock markets. The AEX index lost 4% and is back below 600 points at the time of writing. In Germany, the stock market is 3.5% in the red around midday. The Italian stock market fell even further with 4.6%. Airlines and banks in particular are under pressure.
Investors fear that the coronavirus will have a long-term impact on the economy. Measures to prevent further spread are halting the production and transport of goods. As a result, delivery problems may arise. There is also less travel, which means that fewer Chinese tourists are coming to Europe. That means loss of revenue for various sectors of the economy.
Italy is considering Financial support for the affected regions. In China, there are also calls to help companies that get into trouble support. According to the OECD, the outbreak of the virus has forced countries worldwide to provide new fiscal stimulus consider. Several central banks have already indicated that they can take measures to support the global economy, such as interest rate cuts, liquidity injections and new asset purchase programs.
This contribution was made from Geotrendlines
