Is it time for Gold bull run?
There was a recent price rally in Gold on 15 January 2015, which was sparked by the SNB’s completely unexpected decision to abandon the EUR-CHF minimum exchange rate of 1.20. Due to this there was a turmoil in the currency markets, which resulted in investors seeking safe haven in gold.
Outbursts of obscenities and confusion followed the Swiss central bank’ s surprise decision to abolish its three-year-old policy of capping the Swiss franc against the euro (started in 2011), according to traders in London’s financial district. The u-turn sent the Swiss franc as much as 41% up against the euro, the biggest gain on record, a move that one trader estimated may cause billions of dollars of losses for banks and their customers. The euro could fall further once the European Central Bank (ECB) begins quantitative easing (QE), buying bonds to inject cash into the euro zone banking system to stimulate the economy and push the economy into an economic recovery.
Called the “biggest currency shocker in years”, the move by the Swiss central bank caught everyone off guard and sent financial markets into a tailspin and it is likely to create more volatility in financial markets in the near future.
Our view on Gold is that it would increase further as there is no stability in the currency markets.
So, what are your views regarding Gold prices? Will the Gold prices continue to rise or is this just a momentary rise?
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