The price of gold has almost reached a record of 2020

On Wednesday, gold prices continue to rise, following the dynamics of yesterday and approaching a record high in 2020. The growth of quotations of the precious metal was promoted by new signs of slowing economic growth, as a result of which the demand for gold as a «safe haven» jumped.

Market participants generally ignored the words of the head of the Federal Reserve Bank of Cleveland, Loretta Mester, that the interest rate in the United States will continue to rise, despite the weakness of the economy, and will remain above the 5% mark for a long time.

Data on weak manufacturing activity in the country, as well as a decrease in the number of vacancies (which indicates a cooling of the labor market in the United States) had a greater impact on the dynamics of the metals market. Fresh statistics made investors doubt that the Fed will have a lot of room for further rate hikes. Weak economic indicators also increased concerns about the impending recession, which caused an influx of funds into gold.

During the day, the price of gold rose to the level of $2.048.90 per ounce. The spot price of the precious metal is now trading at less than $30 from the record high of $2,072.90 per ounce reached at the height of the COVID-19 pandemic.

The gold market began its growth in early March, when fears of a banking collapse spurred the safe haven market. The precious metal received additional support due to growing expectations that the Fed will have limited economic space for further interest rate increases.