Gold prices held steady on Tuesday after climbing to a one-week peak in the previous session, as concerns about the coronavirus epidemic that has claimed more than 1,000 lives in China offset an uptick in equities.
Spot gold was little changed at $1,570 per ounce price touched its highest since Feb. 4 at $1,576.76 on Monday.
With bond yields at historical lows, and even negative in some parts of the world, investors are navigating uncharted waters, and gold demand could see a surge.
If you have mean reversion in terms of gold and gold-related equities, you will see between triple to quadruple demand in precious metals and precious-metals related assets.
No prudent investor wants his life insurance to pay off because that means someone has died, and this is what gold is all about.
There is an excess of liquidity in the monetary system in the form of quantitative easing that will ultimately drive gold prices higher.
Gold prices, under these conditions, could “easily” go to $2,000 and beyond, but it may not happen right away.