Last week, we saw the spot value for gold in USD dip to its largest weekly fall since December. Reports suggest that the dip was due to a firmer dollar based by positive jobs data last week. Some are proposing that this dip could be sustained on the short term, until faith in USD is brought back in line.
In today’s blog we are going to take a look through our top talking points this morning including possible top prices for gold, the current situation for cryptos and of course, a bit of Brexit.
Last Year & This Year
So far this year, gold prices have seemed to benefit from the weaker USD, despite the 3 interest rates hikes in 2017 and the expectation of more to come this year. In fact, gold bullion in USD has climbed 13% over the past year, rising from $1,196 in March 17 to $1,360 in Jan 18.
Perhaps this is a mark of the strength the precious metals hold with people?
A recent survey from the LBMA suggests that the gold price throughout 2018 is set to have much more of an interesting journey than the one we saw in 2017, which was fairly subdued in comparison to the 2016 Brexit impact. The surveys predictions for a gold high ranged from $1,120 to $1,510! This wide spectrum is based around the difference of opinions when it comes to the impact that US interest rates and other geopolitical events will have, Brexit being one of them.
The various news sources love to tell us that whatever the next set of Brexit talks are, they are the most important so far! This week is set to be no different.
Number 10 has suggested that the EU will leave the customs union after Brexit, what impact this could have on a global scale remains to be seen, but we have seen that mere suggestions of change to a countries import and export can cause currency moves and can push investors towards safe-havens.
Perhaps more important to the UK on the global scale, is the perception other countries have of us. Constant press speculation of divides in the conservative party and even divides in the team tasked to push Brexit through, could give the impression that our position is weak, leaving us to negotiate on the back foot…
Cryptos vs The Banks
We saw the impact of cryptos hit throughout the latter part of 2017, when many investors had their attentions swayed by the thought of a ‘quick win’. Since then, we have seen the decline of many cryptos, which mostly began this year, despite this, the decline hasn’t stopped many newcomers from trying to cash in on the bubble.
We heard today that Lloyds have decided to stop its credit card customers purchasing any crypto currencies in order to ‘protect’ their customers from losses and themselves from picking up the bill if customers default on their repayments.
This is a bit nanny state for our liking, but, with the global economy not that far removed from where it was before the financial crisis, perhaps Lloyds could be believed?
It will be interesting to see if any other banks follow suit and stop their customers purchasing cryptos with credit.
As always, no one can say for sure what will happen, whether that be in politics, investment markets or for gold.
Only time will tell.
This blog represents one person’s opinion only. Customers should conduct their own research and take advice before making an investment. We do not offer investment advice.