Gold prices broke $1,400 per ounce early in the day Friday for the first time since September 2013.
The spot closing price on the New York Mercantile Exchange was $1,399 per ounce, up $11.10 — which is still good news for gold producers.
Gold futures went as high as $1,415.40 Friday.
CNN Business stated that the gold price is now up nearly 10 percent this year and attributed the uptick to expectations of an interest rate cut by the Federal Reserve as soon as next month. CNN also said the continued drama surrounding trade talks between the United States and China is helping push the gold price higher.
Unless President Trump and Chinese President Xi Jinping come to a deal at next week’s G20 meeting in Japan, gold prices could keep climbing, according to CNN.
Richard Baker of Eureka, who writes the Eureka Miner’s Market Report, said Friday that “this week’s markets experienced an avalanche of news propelling the S&P 500 to new records, gold to six-year highs and the 10-year Treasury to yields below 2 percent.”
CNBC reported the S&P 500 was up 2.3 percent this week, closing at a new high of 2,964.15 Friday.
Baker also said that European central banks and the Federal Reserve “signaled the possibility of monetary easing, which gives a boost to gold and commodities on expectation of a weakening U.S. dollar. The central banks’ dovish stance and optimism about the upcoming Xi/Trump meeting drove domestic equities higher. Escalating tensions in the Gulf of Oman elevated the yellow metal above the mercurial $1,400 level on a safe-haven play but had little impact on stocks.”
Newmont Goldcorp Corp. shares closed Friday at $37.49, down 9 cents, while Barrick Gold Corp. shares were up 30 cents at $15.60. Kinross Gold Corp. shares closed at $3.79, down 3 cents.
Marketwatch quoted Juan Carlos Artigas, director of investment research at the World Gold Council, as saying that “gold is a global market and U.S. monetary policy, while important, is not the only driver of performance.”
He said a combination of increased geopolitical tensions and a more accommodative monetary policy stance signaled by central banks have pushed global interest rates lower.
Marketwatch also quoted Maxwell Gold, director of investment strategy at Aberdeen Standard Investments, as saying that “further tensions in the Middle East could bid gold prices higher through haven demand in the short term.”
He said, however, that “key factors in control of gold right now are rates and recession fears.”