The gold price today has been on the rise for several months. Financial analysts predict that gold may reach $2,000 an ounce by the end of the year. It is important to make an investment in gold now. The price is increasing slowly and financial analysts believe that it will not slow down. There are several reasons that gold has been rising in price. Continue reading for more information about the causes of the rising gold price.
Increasing Deficit of the Balance of Trade
Gold prices are rising because of a growing deficit in the balance trade to countries such the United States. The rise in imports to private use (which also includes volume of exports) is the cause of the deficit. The balance of trade deficit is caused by the 1.4% increase in imports and 0.4% rise in exports. This is the main reason why gold has been rising in price.
Low Output for Gold
Low gold output from important gold-producing nations like South Africa, China, Australia and China is another reason for gold’s rising value. Due to the low gold production from these countries, there has been an increase the demand for gold. This has resulted in an increase in gold prices elsewhere.
Economic and Politic Factors
Experts say that economic and political events in the world have an impact on gold. Fluctuations in the global oil market as well as the financial markets impacted gold’s price rises by approximately 25% in Asia. The fluctuations had an impact on the exchange rates in many countries. This led some to store large amounts raw gold. This is done to guard against security threats and political risks caused by the fluctuating world economy.