Gold has updated the annual high at around $1346 per troy ounce. The last time the metal cost so much was April 2018. The asset has approached the zone, which it has been trying to get over since 2014. The nearest setback is the resistance level of $1365, which is the April high. There is every chance that gold will test it after correction.
The main reason for local growth is the ongoing trade negotiations between the United States and China. They bring instability to the market in general, which only plays into the hands of safe haven assets like gold. Last Tuesday, Donald Trump repeated his intention to postpone the new tariffs on $200 billion worth of Chinese goods due on March 1. Until the deal is signed, everything is nothing but intentions, and traders can see this risk.
The growth of gold is also driven by the Central Banks of various countries, which are raising their gold reserves. For example, the Bank of Russia purchased 200,000 troy ounces of gold (about 6 tons) in January. Major players and institutional investors are taking interest in gold ETF funds. Morgan Stanley became the largest shareholder of the ETF Gold Trust, having acquired $590 million worth of shares.
The current unstable geopolitical situation in the world, the expected slowdown in growth rates, and perhaps even the recession of the global economy, will increasingly make investors choose gold. There is every chance that it will update the yearly highs in the near future.