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GOLD PRICE SURGES AFTER BREXIT BECOMES REALITY

The gold price surged 6% upon the news that the United Kingdom voted to leave the European Union, according to a press release from the World Gold Council.

“With Britain voting to exit the European Union, we expect to see strong and sustained inflows into the gold market driven by the staggering level of protracted uncertainty that investors now face. As geopolitical and market uncertainty rises, we expect gold inflows to accelerate,” says a statement from the World Gold Council.

While Sterling traded at a 31-year low and world equity markets saw dramatic falls, the gold price surged to the highest level since 2014, providing investors with a much-needed safe haven.

The Bank of England has said that it is ready to take whatever action is necessary, according to the World Gold Council, which adds that other central banks are likely to do the same. “In practice, this could mean interest rates move further into negative territory in parts of the world, another positive for gold. Central bank action has already capped the gain in other safe haven assets, with the Swiss National Bank intervening early this morning,” notes the World Gold Council.

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