Although it has not yet returned to the historical peak of 3,500 USD/ounce set last month, gold prices have erased all of last week's declines and closed the weekend session above 3,300 USD/ounce, equivalent to an increase of 3% for the week.
What is of great interest is the strong fluctuations in gold prices. This week, the range ranges up to 6%. Last week it was nearly 5%, and last week it reached nearly 10%. Over the past 25 years, the average gold price fluctuations have been around 1-2% per day. This year, the figure has increased to 2.3%.
Increased volatility makes trading more difficult, but gold's long-term outlook is still reinforced by factors such as geopolitical instability, global public debt and the risk of escalating inflation.
According to many experts, investors should prepare for the next fluctuations when the US and China hold a meeting over the weekend to discuss global trade. However, there are still two unanswered questions: How much damage has the global economy done and how long does it take to recover?
As long as there is no clear answer, gold will remain an important safe haven asset. According to FTSE Russell's research, the traditional 60/40 portfolio model is gradually losing its effectiveness, and investors should allocate at least 20% of their portfolios to gold.
Gold is no longer just a defensive shelter, but has become a strategic tool for effective navigation in the context of increasingly complex multi-asset - experts emphasized in the report.
Data continues to show increased demand for gold, especially from Asian investors. According to the World Gold Council, last month, Asian investors bought 69.6 tonnes of gold through gold-backed ETFs, equivalent to $7.31 billion. Meanwhile, North American ETFs recorded only 44.2 tonnes of cash flow, worth $1.83 billion.
With such a strong wave of gold buying, it is not difficult to understand why more and more banks predict that gold prices could reach the mark of 4,000 USD/ounce. Bank of America is currently the most optimistic unit, believing that gold prices can achieve this target this year.
