Gold prices remain flat ahead of election


Little to no movement in precious metals markets during lead-up to the U.S. election

Gold prices remained flat for the second consecutive day as the world awaited Tuesday’s U.S. presidential election results. Many experts have suggested that the potential winner of the race between former President Donald Trump and current Vice President Kamala Harris will not be known until Wednesday at the earliest.

Gold traded just shy of $2,740 an ounce early Tuesday just an hour after polls opened across the east coast of the United States.

 Gold prices have traded flat ahead of the U.S. election. (Source: TradingView) (credit: PR)
Gold prices have traded flat ahead of the U.S. election. (Source: TradingView) (credit: PR)

Two weeks ago, strategists at Bank of America said investors loaded up on gold ahead of the election as a hedge against inflation and populism, according to Bloomberg.

A report released Monday by CNBC suggested stocks typically rise following a presidential election, but that normally occurs after a period of short-term volatility.

Losses that occur following election day are often erased by the end of the calendar year, the reporting showed.

 Stocks have dropped following election day just four times since 1980 by the end of the calendar year. (Source: CNBC) (credit: PR)
Stocks have dropped following election day just four times since 1980 by the end of the calendar year. (Source: CNBC) (credit: PR)

Any short-term losses in equities related to uncertainty surrounding the election could provide a short-term boost for gold and other precious medals.

This week is also one of the largest weeks for gold mining earnings reports, bringing an increased chance of volatility to the market.

West enters the market

World Gold Council Senior Market Strategist Joseph Cavatoni told Kitco News on Monday that Western investors are beginning to enter the market after months of reporting that gold’s rally was mainly attributed to demand from the Eastern world.

“(We’re starting to see the) first signs of the Western investor returning to the market,” he said. “Predominantly in the U.S. The European market has been slower than maybe we anticipated.”

Cavatoni said he believes Western investors have concluded they have not yet missed the rally in gold and higher prices are still being supported by the East.

“I think many were fixated on the rate environment — but what they’re realizing is they haven’t missed (the rally). The global demand profile is keeping support for gold prices high.”

This article is for informational purposes only. The opinions and analysis herein are those of the author and are not financial advice. The Jerusalem Post (JPost.com) does not endorse or recommend any investments based on this information. Investors should consider their financial situation, investment goals, and risk tolerance before making any decisions. Consulting a qualified financial advisor is recommended. JPost.com is not liable for any investment losses from using this information. The information provided is for educational purposes only and should not be considered as trading or investment advice.
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