The price of gold has risen significantly over the last couple of weeks, trading at $3077.30 per ounce by the end of last week. Thus far this month, the metal’s price has risen by 8%, with analysts expecting that it could end the quarter with a 17% increase.
Gold has historically been viewed as a hedge against inflation and economic uncertainty. Previous rallies in gold prices have often coincided with periods of high geopolitical risk, inflationary pressures, or recession fears.
One senior market analyst at Trade Nation, David Morrison, argues that investors need to be cautious at this moment, though. This, he explains, is because the precious metal’s levels are still lower than they were weeks ago, having already crossed into overbought territory. Overbought conditions in financial markets typically indicate that a price correction may be imminent as traders begin taking profits.
This sentiment isn’t shared by all, though. Tom Bruce, a macro investment strategist, says that gold is still attractive to many investors as a safe-haven asset. He explains that high levels of geopolitical turmoil and economic uncertainty have resulted in the metal’s shallow corrections, noting that despite this, the price of gold may continue to increase in this environment.
Some analysts expect the metal’s price to hit $3,100 this week, with further upside potential if market conditions remain favorable.
American economic data has also demonstrated some growth, which supports the precious metal’s price. Data on employment scheduled for release this week is expected to generate some volatility though, with analysts declaring that weaknesses in the labor market may increase safe-haven demand for gold.
Economists at TD Securities claim that DOGE-affiliated layoffs and increasing uncertainty around America’s economic outlook may have reduced payrolls’ momentum this month. If payroll data comes in weaker than expected, it could drive gold prices even higher as investors look for security in tangible assets.
The implementation of new tariffs on cars, light trucks and auto parts coming into the U.S. by the Trump Administration, as recently announced, is also expected to influence market reactions. The tariffs on automobiles are slated to take effect on April 2nd, which Trump has referred to as America’s Liberation Day, while tariffs on parts will go into effect on or before May 3rd.
Following this announcement, the Office of Canadian PM Mark Carney released a statement declaring that they would enforce retaliatory tariffs on American goods in response to the promised import taxes.
These trade tensions could further boost gold prices as tariffs generally contribute to inflationary pressures, leading investors to seek protection in precious metals. Investor interest is also likely to be directed toward firms like Aston Bay Holdings Ltd. (TSX.V: BAY) (OTQB: ATBHF) that focus on developing gold-rich mineral properties.
NOTE TO INVESTORS: The latest news and updates relating to Aston Bay Holdings Ltd. (TSX.V: BAY) (OTCQB: ATBHF) are available in the company’s newsroom at https://ibn.fm/ATBHF
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