On Wednesday, gold prices as shutdowns of the US government increased to record high records.
Chris McGrath | Getty Image News | Getty images
Gold prices reached a new height on Wednesday as US government Enter your first shutdown In about seven years, MPs failed to reach a deal on government funding.
Spot gold While hitting a record of $ 3,894.63 an ounce, while American gold futures Extended advantage to reach a high level of $ 3,922.70 for December delivery.
While the impact of government shutdowns on markets is usually minimal, the time of this time is important. Critical US Jobs data due to being published on Friday Will be delayedGiving a cloud to Outlook a few weeks before its next meeting for the Federal Reserve. President Donald Trump Also threatened To use shutdowns to cut the “lots” of federal employees, which are usually furlings during a shutdown and bring back after working once.
Due to no clear way towards a deal, it is also not clear how long the shutdown will last. During Trump’s first term in the office, the 34-day partial shutdown caught- The longest in history,
Average market change in recent shutdowns
| Shutdown period | All day | Shutdown type | S&P 500 (%) net changes | Wicks points net change | Dxy net changes | 10-year net change |
|---|---|---|---|---|---|---|
| 12/22/18-1/25/19 | 35 | Partial | 6 | -8 | -2 | -17 |
| 1/20/18-1/22/12/18 | 3 | Partial | 2 | 4 | -2 | 15 |
| 10/1/13-10/17/13 | 16 | full | 3 | –1 | -2 | -14 |
| 12/16/95-1/6/96 | 21 | full | -3 | 4 | 0 | 1 |
| 11/14/95-11/19/95 | 5 | full | 3 | –1 | 1 | -10 |
| 10/5/90-10/9/90 | 3 | Partial | -5 | 3 | -3 | 2 |
| average | 1 | 0 | –1 | -4 |
Source: Bank of America
Amid uncertainty, Risk property lost landWhile gold – usually seen as a safe shelter property in the time of economic or geo -political unrest – continued its bumper rally to make its 39th record high this year.
$ 4,000 gold?
Morningstar chief equity, Michael Field, told CNBC in an email on Wednesday, “Gold positions are well propagated as a safe shelter, but in the last few years the incompetent increase in the price of gold has been really surprising, with the fresh height of today,” Michael Field, Morningstar, Morningstar, the main equity in Morningstar, the main equity in the morning Told CNBC.
While he said that after the driver’s shutdown behind the Wednesday rally, the field argued that it was “just the straw that broke the camel back.”
“Two major ongoing conflicts, political instability in France, newly declared tariffs, all of this is combining to create a very unstable picture for investors,” he said. “And when it becomes hard, gold gets boosted.”
Spot gold price
Filip Gisailles, the chief strategy officer of BNP Paribas Fortis, has long been considered that gold can cross the $ 4,000 mark – and now believes that the metal can be even greater.
He said, “Gold is fast closing at a target of 4000 which we put forward … about one and a half years ago,” he said. “Next, the step was completely inspired by buying the Central Bank, while the investors were a pure seller of the yellow metal, (but) from the beginning of the year, the investors have come on the board, which has clearly intensified to reverse the move.”
He argued that in the midst of ongoing uncertainty and instability, and an atmosphere of viscous inflation worldwide, investors were roughly considering that he should be separated from the classic 60/40 portfolio strategy “from” hard assets “like” gold with “hard assets” with “hard assets”.
“Nevertheless, we are still very early in the game as gold, and gold -related investment is barely 2% of an average investment portfolio worldwide,” Gisels said. “To say this in baseball words, we are only in the second or third innings. $ 4,000 (will not) closing point – the world has ever seen the strongest bull market in precious metals that the world has ever seen.”
In a note to customers on Wednesday morning, UBS strategist Joni Tevs also argued that gold was less owned by.
He said, “We hope that the bull run of the gold will continue on the upcoming quarters, with the rising investor positions and continuously widely widely in the investor base of the gold. With the cycle of reducing the fed, the dollar weakness and decline in real rates should increase rapidly for the price of gold,” he said.
Teves said the UBS had hoped that the rally would depart at the end of 2026, in anticipation of Fede’s end of the cycle and improvement in economic conditions.
He said, “It said that, given the structural change in the role of gold, strategic asset has become a major part of allocation, we hope that the reform will eventually be absorbed and to stabilize the prolonged historically high levels for prices,” he said.
, Alex Harring and Fred Imbert of CNBC contributed to this article.
