Posted: 30.11.2022 11:36:00

Opinion: gold prices to grow in 2023 due to financial instability

The gold market is always directly interconnected with the economic and financial condition of its key players: the United States, China, Japan, the Middle East, Russia and others. For example, when the US faces problems, international investors' distrust of the Dollar as a means of payment is growing, and gold prices are also skyrocketing. Aleksei Avdonin, an analyst with the Belarusian Institute for Strategic Studies, explained the reason for this trend.

“Gold is a natural equivalent of value. This means that – in the event of any cataclysms and wars – it can always be exchanged for any goods and services. This is its advantage over national currencies. We have been observing such dynamics over the last five years. Since 2017, gold has been growing in price. In the beginning of this period, it cost $1,200-1,300 per ounce but, in July 2020 (the height of the lockdown), its price reached $1,980. Since then and until March 2022, the price fell to $1,712. In October, it made about $1,640 per ounce. The recent interest rate hikes by the US Federal Reserve and the Bank of England to combat inflation have led to a new growth: gold prices now stand at around $1,670 per ounce. Experts predict that – due to the unstable situation in the financial markets – the figures will continue growing 2023. In this regard, central banks are trying to minimise their risks: as of November 1st, 2022, they bought a record volume of gold in the past 55 years," Mr. Avdonin said.