"Gold is trading more like a trending stock on Reddit than a haven for investors, and may have topped out after its record surge, billionaire investor Bill Gross told Business Insider. The yellow metal fell as much as 6.3% on Tuesday, suffering its worst drop in 12 years. The drop coincided with an even steeper 8.7% decline in spot silver prices."
"Gross told Business Insider that gold was still "sensitive to short-term interest rates," referring to the metal's tendency to rise in price when borrowing costs drop. That's because falling rates make gold more appealing to investors relative to cash and bonds as their yields decline. Lower rates can also accelerate inflation, making gold a more attractive hedge against rising prices, and signal economic trouble, feeding demand for gold as a safe investment."
Gold surged this year and then experienced its worst single-day drop in 12 years, falling as much as 6.3% while silver fell about 8.7%. The recent moves reflect profit-taking after record gains and speculative momentum that resembles meme-stock behavior. Gold remains sensitive to short-term interest rates because lower rates reduce yields on cash and bonds, boost inflation expectations, and increase demand for gold as a hedge and safe asset. Central banks have been buying unusually large amounts of gold amid policy uncertainty, and that demand has contributed to price gains and heightened market attention.
Read at Business Insider
Unable to calculate read time
Collection
[
|
...
]