Since the old days, gold has been the run to investment when risks increase. But, not anymore. Bullion was supposed to have a great week based on the increased tensions in Italy and to a lower degree Spain, how the global markets responded to these risks, the trade tensions between the US and China, and the deadline for the US decision on imposing tariffs on European steel and aluminum.
In 2018, gold did not have a breakthrough yet, and is on track for a second losing month in May. Even though it did pull back to over 1300 because of weak US data and hope for the Italian situation, Chinese traders have been selling. However, has the chance for bullion to prove that it is the risk haven passed? The dollar stopped its losses, investors are more optimistic about Italy after former IMF official was nominated as prime minister, president Trump and Kim’s meeting seems more foreseeable which would ease the US-Chinese relations, and investors are waiting to see the tariffs that will be imposed on European goods. On the political spectrum, the US and Europe are having some tensions because of the Iranian situation. Most people can see the US imposing tariffs but the reaction to those tariffs by Europe can play a huge role in the coming days.
Could crypto become the new risk haven for upcoming “millenial” investors. I do not believe so, but I know some people that disagree.