Tom Palmer: “Gold price rises by about 10% due to war between Israel and Israel”

As the conflict between Israel and the Palestinian armed faction Hamas worsens, an analysis suggests that the price of gold could hit an all-time high.

According to the British Financial Times (FT) on the 6th (local time), Tom Palmer, CEO of Newmont, the world’s largest precious metals mining company, said in an interview, “If the war continues, the price of gold may hit an all-time high, but this “The scenario is not good,” he said.

After the war between Israel and Hamas broke out on the 7th of last month, the price of gold rose about 10% compared to before, closing at $1,992 (about 2.59 million won) per ounce (about 31g) on ​​the 3rd.

“What has happened over the past few weeks is one of the factors that has led to the price of gold reaching the level it is now,” Palmer explained.

Another factor in the rise in gold prices is that the U.S. Federal Reserve’s interest rate hike is nearing its end. This is because investors’ predictions that interest rate hikes would last longer before the Israel-Hamas war broke out caused the price of gold to fall.

The Federal Reserve froze interest rates at its meeting on the 2nd, but left open the possibility of further tightening.

“There are a number of fundamental factors that are causing the price of gold to continue to rise,” Palmer said, adding, “Unfortunately, the price of gold continues to rise globally.”

As interest rates rose sharply around the world, the prices of non-yielding assets such as gold were expected to fall, but the U.S. central bank purchased gold in large quantities, causing prices to rise. China’s high consumption of gold luxury goods is also a factor in rising prices.

Meanwhile, gold prices hit an all-time high of $2,072 per ounce (about 2.69 million won) in August 2020, when the U.S. economy was hit hard by the COVID-19 pandemic.

Source: Donga