Uncertainty is stimulating the price momentum of Gold, according to analysts at the Capital Markets newsletter the Kobeissi letter.
The official account of the Kobeissi letter on the social media platform X notes That on the way to this year, Gold had the S&P 500 since 2020 with around 10% with around 10%.
“Because the uncertainty has risen, however, GLD has now increased +109% since 2020 compared to +74% in the S&P 500. But why do gold prices rise, even when the market is recovering? Uncertainty remains the answer.”
The analysts too remark That Golden Funds witnessed around $ 8 billion three weeks ago, a record setting total that suggests that “a continuous flight to safety” suggests.
“As a result, the advancing average of four weeks of the inflow to ~ $ 4 billion, also a record high rose. This is probably the strongest gold market of all time.”
They also say that buying central bank ‘historically strong’ remains. The newsletter notes that fOreign Holdings of Treasuries as a percentage of the US government debt has fallen to around 23%, the lowest in more than two decades.
The analysts, who quoted data from the Macro -strategist Otavio Costa, also note that gold interests have risen to around 18%as a percentage of global reserves, the highest in 26 years.
The Kobeissi letter too point to That the US Dollar Index (DXY) recently fell to a low point of 52 weeks. The DXY measures the strength of the USD against a basket with other large strange currency.
“The US Dollar, DXY, has been weakened by almost 10% since the trade war started. A weaker dollar makes USD-Communominated gold cheaper for foreign investors. Gold almost serves as a prominent charges for rates.”
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