Connections of War and Gold Pricing
Connections of War and Gold Pricing
Posted on : 01 May, 2024 | Last Update - 7 months ago
The recent conflict in the Middle East, particularly the Israel-Hamas situation, has led to a rise in gold prices. Geopolitical tensions and global risk aversion have increased the demand for safe-haven assets, and gold is often seen as a hedge during uncertain times. If the conflict escalates and involves more nations, or if there are disruptions to the oil supply, gold prices could benefit further.
Gold also experienced significant gains during the Russia-Ukraine war, and there's potential for similar price increases if geopolitical worries persist. However, it's important to note that while gold remains attractive to value-conscious investors, it might not replicate the same robust rally seen during the Russia-Ukraine conflict. The current conflict's impact on global supply chains is expected to be less pronounced.
In the domestic market, key support levels for gold are increasing. Gold prices had been trading in an oversold zone but rebounded due to factors like easing inflationary fears and a weaker US dollar index. The short-term momentum for gold appears likely to continue, however, whether it will match the Russia-Ukraine war's performance remains uncertain.
No matter the outcome, it's certain that gold cannot be overlooked as an essential asset during times of conflict or war, and its value remains ever growing.
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