GJ Town India

Gold’s role as a strategic asset! Global Head of Research, World Gold Council Juan Carlos Artigas focussed on the ongoing catastrophes and the sentiment of geopolitics. He said, as the world’s attention has shifted to the crisis in Ukraine, we have received a lot of queries from investors about the effects of the recent events on gold’s performance in the short, medium and long term. Taking a step back, we believe that geopolitical events in isolation are neither the only nor the main reason why investors should own gold. Gold’s role as a strategic asset is linked to its broad contribution to returns, diversification, liquidity and positive portfolio impact. However, events like these represent a clear example of why gold is such an effective and well-established hedge against expected and unexpected market risks. As Russian troops entered Ukraine on February 24, morning GMT, the gold price surged to an intra-day high of US$1,974/oz and while it has given up most of Thursday’s gain...

The positive link between global economic expansion and gold The IMF Global Financial Stability report, released, highlighted an increase in the level of risk among multiple global metrics. Following its publication, stocks in the US, Europe and Asia lost 4%, 3% and 4% respectively over three days. While the market has regained some of its early losses, we believe the report and the subsequent market pullback underline the relevance of holding gold in the near and long term. Last week stocks sold off, and gold acted as a key flight-to-safety asset in the market. Initially, as the US market retreated, gold held steady. But as the sell-off became more systemic globally, gold began to rally meaningfully. De facto gold has fallen by more than 11% from its April high and is currently around 7% lower y-t-d amid bearish investor sentiment. Much of this performance has been driven by a risk-on appetite in the US, where the dollar – which historically is inversely correlated...