The price of the metal has been on the rise since mid-June and buyers have managed to finally reach the $1,800 level after much adversity over the past two to three months.
Gold’s continued surge is a bit curious given the comeback in the broader market. The pop in gold prices earlier this year made more sense since gold often tends to do well in times of financial stress, when fear is prevalent.
After an initial dip following the 2008 Lehman Brothers bankruptcy, gold rallied as the market melted down later that year and into early 2009, for example.
And gold prices hit their all-time high in 2011 after Standard & Poor’s downgraded the United States’ credit rating, amid market jitters about Europe’s sovereign debt crisis.
Central banks around the world had been buying nearly $2.4 billion in financial assets every hour for the two months ending in May, according to Bank of America data, taking the overall total to around $4 trillion.