Hong Kong – Analysts and economists have indicated at a 20% hike in gold rates next year. Gold prices rose by 15% in 2019, the highest recorded increase in the decade. Analysts have underscored that geopolitical tensions and consistent reduction in the interest rates by the central banks of the world were the main factors that contributed to the hike.   

A trade war is ongoing for over a year between the United States and China, the world’s two leading economies. Even though a preliminary agreement to end the trade war has reached, the process has not initiated. The global economy, therefore, remains under uncertainty. At the same time, despite the confirmation on Brexit, the process is still not complete. Intense conflicts are ongoing between the Middle East states, while Hong Kong protests have only added to the instability. 

The repercussions of the uncertainty are visible on the global economy, causing the central banks to adopt a cautious approach. The interest rates are being consistently cut down, whereas gold purchases have surged significantly. The demand for gold has, therefore increased, which is a prime factor attributing to the rise in gold rates, analysts claim. Stephen Innes, Market Strategist at AXITrader, asserted the gold rates would go up to $1,774 per ounce in 2020.  

Previously, the gold rates had skyrocketed to $1,895 per ounce in 2011, considered a record. Although there are no signs of the prices crossing the level, the gold rates will see an increase of 20%, Innes stated. Hong Kong-based precious metals analyst Joshua Rotbart indicated that the Gold rates would remain above $1,600 per ounce with a possible rise of 10 per cent.  

Currently, the gold prices are at $1,480 per ounce and had touched $1,283 per ounce at the end of 2018. Moreover, the analysts have highlighted the rise in gold rates by more than 15 per cent this year.

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