Home NewsFinance NewsGold News With Donald Trump’s Inauguration, Demands and Price of Gold May Rise Significantly

With Donald Trump’s Inauguration, Demands and Price of Gold May Rise Significantly

by Diana
Gold price increase

Financial experts and traders in precious metals are very certain that the demands and prices of gold will rise significantly with the swearing-in of President-elect Donald Trump as the new President of the United States, and this is largely because history has a way of repeating itself and also because Trump’s economic policies and the uncertainties they will generate will influence the price and availability of gold in the market, the South China Morning Post writes.

Since Trump has started to hit out so hard across several economic industries, uncertainties have started to reign supreme with savvy investors thinking it is best to save one’s wealth in precious metals since they have a certainty of increasing in value during crises.

Gold price increase

“Trump’s stance on trade and protectionism has been well aired and it will always be a key factor,” said Robin Bhar, head of Metals Research at the Societe Generale.

“But until we get more clarity on what exactly it means, this should help to underpin gold,” Bhar added. “This year there are lots of uncertain political events, including elections, so if you looking for a bit of a refuge from stormy seas gold will be one of those safe assets that you would park some money in.”

Demand for gold as a safe-haven asset has increased since Donald Trump won the US presidential election and his uncertain economic policies caused the metal to gain 1% on Tuesday to clinch a 6% rise in 2017, even though it gained 8.1% rise in 2016.

However, precious metals brokers are positive that Trump’s new government will influence the price and demand for gold since this appears to have been the norm when past US presidents assumed power. For instance, experts say gold had always gained nearly 15% when new US presidents ascend the presidency since the 1970s.

With prospects of Trump’s economic policies, the value of gold has climbed 4% this year and in 1974 it climbed 72% when President Gerard Ford took over from President Richard Nixon who was forced to resign. It also gained 24% in 2009 when President Barack Obama came to power. The value of gold fell by 33% in 1981 when President Ronald Reagan came to power and it equally dropped in 1989 when President George H.W. Bush was sworn in.

“We have no idea what’s going to happen with some of Trump’s policies, everyone is a little nervous,” revealed Axel Merk, manager of Merk Investments which deals in gold exchange-traded funds and with assets reaching $120 million. “God is relatively undervalued and will push higher.”

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