News agency REUTERS said Gold prices surged more than 2 per cent on Friday last as an effect of the wave of banking crises which shook global markets and put bullion on track for its biggest weekly rise in three years. Spot price for gold climbed 2.8 per cent to $1,971.95 per ounce, highest since April 2022. Bullion has added about 5.6 per cent this week, the most since March 2020.
The breakdown of Silicon Valley Bank in the US has highlighted banks’ vulnerabilities to sharply higher rates, while a rout in Credit Suisse shares has added to the market turmoil.
“Gold is likely to shine through the chaos as investors adopt a guarded stance,” said Lukman Otunuga, senior research analyst at FXTM. The dollar and stock markets slid, making bullion a more attractive investment. While it is considered a hedge against economic uncertainties, gold’s opportunity cost rises when interest rates are increased.
Silver was set for the biggest weekly percentage rise among the four precious metals. It advanced 3.1 per cent to $22.38 per ounce on Friday. Platinum firmed 0.1 per cent to $974.21, while palladium dropped 2 per cent to $1,401.63.