Investors looking for safe haven due to increasing uncertainty: expert

Global economies continue to grapple with the economic consequences of the coronavirus pandemic, which continues to increase economic uncertainty and prompts investors to seek out safe-haven assets. In September, as in recent months, the actions of the Federal Reserve were the main factor affecting price movements in the gold market. The global financial markets are still very nervous - the demand for oil is still weakened and the zloty was losing compared to other currencies. 

In September 2020, gold prices expressed in Polish zloty slightly increased by 0.5 percent (PLN 7,300 per ounce). The price of the ounce in the US dollar at the end of the month stopped slightly below $1,900, a decline of about 3.5 percent. On the other hand, in the longer term, prices denominated in the US currency are in a lateral trend characterized by stability.

For some investors, this result means waiting, for others - an opportunity to buy. This situation is influenced, among others, by the upcoming US presidential election and the growing anxiety over the advent of the flu period, which may trigger another wave of coronavirus disease growth.

"The Declaration of the Federal Reserve on keeping interest rates at a lower level until at least 2023, as well as a change in the Federal Reserve's strategy - setting a new inflation target of 2 percent, are also important. In the opinion of the vast majority of economists, despite the relative calm, the economic environment will continue to support further increases in gold prices,” Aleksander Pawlak, President of the Tavex Management Board, pointed out.

(WBJ)