The Rise in Gold Prices in Recent Months

Gold prices have risen sharply over the past five months due to a number of factors, including economic and geopolitical events. Here are some of the main reasons:

1. Weak US Currency and Interest Rates

One of the main reasons for the rise in gold prices is the weakening of the US dollar. A weak dollar makes gold cheaper for buyers using other currencies, which increases its demand. In addition, expectations of interest rate cuts by the US Federal Reserve are also contributing to the rise in gold prices, as lower interest rates make gold more attractive to investors. ( JP Morgan | Official Website )

2. Geopolitical Uncertainty

Geopolitical conflicts, such as those between Israel and Hamas, as well as the ongoing war between Russia and Ukraine, are also increasing the demand for gold as a safe haven. Investors seek gold when uncertainty is high because it is considered a stable investment in uncertain times. ( JP Morgan | Official Website ) ( World Gold Council )

3. Central Banks and Gold Purchases

Central banks continue to increase their gold reserves, which also supports prices. For example, in January 2024, central banks added 39 tons of gold to global reserves, with Turkey and China among the leading buyers. This ongoing trend of central bank gold purchases is further supporting prices. ( World Gold Council )

4. Technical and Speculative Factors

Technical factors and speculative buying of gold have also played a role in recent price increases. When gold breaks through certain technical resistance levels, this can trigger additional buying by speculators and investors, leading to further price increases ​ ( World Gold Council ) ​.

Conclusion

The rise in gold prices over the past five months is the result of a combination of economic, geopolitical and market factors. A weak dollar, expected interest rate cuts, geopolitical uncertainty and continued gold purchases by central banks are the main drivers of this rise. Despite the short-term fluctuations, the long-term outlook for gold remains positive.