The price of gold entered 2017’s Easter long weekend on a five-month high in response to a cascade of geopolitical events and mid-week comments by United States President Donald J. Trump. With the precious metal inching toward the psychological barrier of $1,300 per ounce, some are recalling the dark days following 9/11 when it broke through $1,900, while others say the price simply reflects gold’s true value as a wealth protector, events of the day notwithstanding.
The week’s global unrest that propelled investors toward the safe haven of gold was punctuated by an interview given by President Trump to the Wall Street Journal. He said, “I think our dollar is getting too strong,” meaning that US manufacturers are less able to compete against cheaper Asian and European products. The greenback dropped immediately, the same afternoon, in sharp contrast to when it achieved its highest level in 13 years—shortly after he won the White House. Trump went on to express his desire that the Federal Reserve reconsider its stated intention to gradually increase interest rates … and gold had a firm toehold from which to climb higher.
Investors cast wary eye on world
“Geopolitical tensions.” They are the words that defined one week in the United States and around the world.
It began with the sarin gas attack on civilians in Syria, attributed by the U.S. and others to that country’s president Bashar al-Assad but denied by him and, pointedly, by Trump ally Vladimir Putin in Russia. Trump then accused Russia of trying to cover up the chemical attack, straining relations for the first time between the world’s two foremost leaders. The U.S. military then unleashed a large number of missiles on the Syrian air force installation said to have been the source of the atrocity. Al-Assad doubled down on his denials by saying the videos of dead children that prompted international outrage were faked, as cover for the American strike.
