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Unraveling the Forces Driving Gold Prices: A Bullish Future Ahead
If history is anything to go by, then previous Gold Supercycles suggest this is only just the start of a much bigger move ahead.
Right now, the precious metal is being driving by “a multitude of bullish tailwinds” including; President Trump’s Tariff’s, which threatens to ignite a new round of Global Trade Wars.
Historically, there has always been a positive correlation between tariffs and Gold prices moving higher. The longer tariffs go on, the more this is going to disrupt global trade and fuel inflation.
Another predominant macro factor is Central Banks around the world continuing to accumulate Gold at a record-setting pace as they aggressively diversify away from the US dollar.
Additionally, persistent instability in China’s economy also sits high on the list, as has spurred Beijing authorities to launch a new project allowing Chinese insurance companies to invest up to 1% of their assets in Gold.
And last but definitely not least – the strong correlation between U.S government debt and Gold prices.
In a note to clients, analysts at GSC Commodity Intelligence wrote “conclusive evidence shows that during the period U.S national debt has ballooned from 5 trillion to 36 trillion dollars – Gold prices have risen by almost 9X since 2000. But here’s where things really start to get interesting. If history repeats itself, Gold prices could reach $5,000 an ounce when U.S national debt hits the 70 trillion dollar mark”.
All of this tells us one thing. Gold prices are only heading in one direction from here – And that’s up!
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