The Daily Aus

Why is the price of gold surging?

Jul 14, 2025
Gold is experiencing a record surge, hitting around $3,800 an ounce, a dramatic rise from five years ago. This shiny precious metal is a go-to refuge for investors during economic uncertainty, especially amid global tension. The discussion highlights the allure of gold against riskier assets and explores its impact on everything from jewelry prices to inflation. Challenges of investing in gold are also covered, stressing the need to understand potential risks and the absence of dividends. It's a fascinating look at why gold remains a valuable investment.
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INSIGHT

Gold: A Safe Haven Investment

  • Gold surges as a safe haven amid multiple global uncertainties like conflicts and trade tensions.
  • Central banks buying large amounts of gold boost its price by reducing reliance on US dollars.
INSIGHT

Why Gold Remains the Ultimate Safe Haven Investment

Gold is considered a "safe haven" investment because it tends to hold its value during times of crisis and uncertainty, unlike stocks that can become worthless if companies fail.

Central banks, like those in China and Russia, have been heavily buying gold recently to avoid overreliance on the US dollar and government bonds, driving the price upward.

Gold's appeal also lies in its physicality: it's rare, durable, universally recognized, and cannot be printed like money.

Investing in gold differs from buying company stocks as gold itself doesn’t pay dividends; its value comes solely from its scarcity and demand.

The fluctuating price reflects investor fear and confidence in the global economy, making gold's price volatile despite its safe haven status.

INSIGHT

Why Gold Holds Value

  • Gold is a safe asset because it doesn't depend on a company's performance or debt repayment.
  • It is physically durable, rare, globally accepted, and historically valued, resisting inflation and volatility.
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