The price of gold peaked above $2,000 on April 5, boosted by weak U.S. economic data as well as fears from the banking crisis shaking up the financial sector.
Spot gold prices hit $2,028 an ounce in early trading on Wednesday, hitting the highest level since March 2022. U.S. gold futures hit a high of around $2,040 per ounce. Meanwhile, the U.S. Dollar Index was hovering near two-month lows, making gold a cheaper investment option for investors holding other currencies. Gold prices in sterling and euros were at their highest level in over a week. The commodity had previously peaked above the $2,000 level in March 2022 and in August 2000.
The boost in gold prices comes amid weak U.S. economic data and the ongoing banking crisis facing the country.
U.S. job openings fell to its lowest level in almost two years in February, suggesting a cooling down in labor market conditions. Meanwhile, new orders for U.S. manufactured goods registered a monthly decline of 0.7 percent in February after falling by 2.1 percent in January.
The collapse of Silicon Valley Bank (SVB) and its after-effects have shaken confidence in the American banking industry. The risk of more bank failures and potential tightening of credit availability are also pushing up gold prices.
In an interview with The Epoch Times, Gabe Wright, co-owner of the store Coin Heaven in Arizona, said that SVB collapse has spurred demand for the yellow metal.
“After that bank fell, it created quite a panic, and people wanted to get their funds out of banks and into something real and tangible—gold and silver,” Wright said. Gold is “something you own. There’s no third party involved. It’s solely yours.”
Federal Reserve Rates
Gold prices are also buoyed by investor expectations that the Federal Reserve will pause its interest-rate hikes and even start cutting rates soon. According to the CME FedWatch Tool, the majority of interest-rate traders (65.4 percent), as of April 5, expect the Fed to keep rates unchanged at its upcoming May meeting.
Over the past year, the Fed had pushed up its benchmark rate from around 0.5 percent to a range of 4.75–5.0 percent. High interest rates usually decrease investor appeal for gold as it is a non-yielding asset.
With expectations about Fed pausing and reversing its rate hike growing, the yellow metal is once more becoming an attractive investment option.
In another Epoch Times interview, Peter Schiff, the CEO of Euro Pacific Asset Management, said that inflation will remain “significantly above” the Fed’s 2 percent inflation rate target “as far as the eye can see.”
“Gold needs to be repriced much higher to reflect that reality. The adjustment still has a long way to go,” he predicted.
However, if the Fed makes it clear that it intends to keep raising interest rates till inflation is brought down, it could negatively affect the price of gold. James Bullard, president of the Federal Reserve Bank of St. Louis, had recently batted for more rate hikes to fight inflation.
Rising Demand
Gold demand has been rising over the past year amid economic uncertainties. According to data from the World Gold Council (WGC), annual gold demand jumped by 18 percent year over year in 2022, hitting 4,741 tons, which is the highest annual total since 2011.
Louise Street, senior markets analyst at WGC, pointed out that gold demand last year was partly driven by “colossal” demand from central banks as a safe haven asset.
“Turning to 2023, economic forecasts are pointing to a challenging environment and a likely global recession, which could lead to a role reversal in gold investment trends. If inflation comes down, this could be a headwind for gold bar and coin investment,” he said.
“Conversely, continued weakening of the U.S. dollar and the moderating pace of interest-rate hikes could have positive implications for gold-backed ETF [exchange=traded fund] demand.”
Article cross-posted from our premium news partners at The Epoch Times.
Why the National Debt Is the Looming Threat to Your Retirement Plans
The Hidden Crisis No One Is Talking About
Every day, headlines warn about inflation, market volatility, and global instability—but the greatest looming threat to your retirement might be something far more fundamental: America’s skyrocketing national debt.
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With debt growing faster than most Americans can possibly fathom, the government’s borrowing habits have reached historic—and dangerous—levels. To cover spending, Washington is making moves with their budget packages, tariffs, and taxes. Is it enough? No. It’s not even close to what would be necessary to stop out-of-control debt, let alone reverse it.
How Debt Erodes Your Nest Egg
There are only so many levers government and the Federal Reserve can pull to try to protect Americans, assuming that’s even a top priority for them. Unfortunately, pulling one level to relive one pressure invariably adds pressure from another direction. This is why prices keep going up even as inflation reportedly slows.
For retirees and pre-retirees, that’s a perfect storm. The dollars you’ve worked hard to save lose value, and your cost of living increases while your investments lag behind.
If you’re relying solely on paper-based assets—stocks, bonds, or mutual funds—you’re essentially tied to the same system that’s creating the problem. It’s a system that was designed to work well in the 20th century, not in today’s world with people living longer and the dollar rapidly losing value.
This is why the 3-minute report, “Debt Will Hit $40T in 2026: Prepare Your Retirement Now,” is so important.
The Precious Metals Hedge
Thousands of Americans are looking for a tangible, time-tested hedge: physical gold and silver.
Unlike paper assets, precious metals aren’t dependent on government policy or the stock market’s mood swings. They’re real, finite resources that have maintained value for thousands of years through wars, recessions, and inflationary periods.
In fact, during times of high inflation and fiscal instability, gold often performs its best—because it’s seen as a store of value when faith in the dollar weakens. This is why prices have skyrocketed this year and are expected by many economists to continue going up in the future.
Take Control with a Gold IRA
One of the most effective ways to protect your retirement from national debt fallout is through a self-directed Gold IRA. This IRS-approved account lets you hold physical gold and silver within your retirement portfolio, giving you:
- Direct ownership of your assets
- A hedge against inflation and dollar decline
- The control to diversify beyond Wall Street
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The Next Step: Secure Your Financial Future
Augusta Precious Metals has helped thousands of Americans with at least $50,000 to invest from their IRAs, 401(K)s, TSPs, and other retirement accounts safeguard their savings through precious metals.
If you’re concerned about what the rising national debt could mean for your future, now is the time to act.
Read this 3-minute report titled, “Debt Will Hit $40T in 2026: Prepare Your Retirement Now“ and learn the simple steps you can take to protect your retirement.