Gold prices report on June 11, 2018

The first week of June became a landmark for the growth of gold due to the extremely unstable political situation in the US and Europe alike.

On Tuesday, 5th of June, against the backdrop of protectionist measures in US trade with Mexico, the price of the yellow metal increased from $1,291 to $1,296 dollars per ounce.

One of the main reasons for such a sharp price hike was Mexico's imposition of counter-sanctions (trade duties of 15-25%) against the United States.

Since the inauguration of the US President Donald Trump, the diplomatic and economic relations of neighboring countries have severed. In less than two years, the US government imposed restrictions on import of steel and aluminum, and control at the Mexican border has been strengthened not without the help of the US National Guard.

On Wednesday, 6th of June, the price of the precious metal was $1,296 per ounce.

During the June meeting, representatives of the US Federal Reserve made a final decision on raising interest rates in September and December 2018.

According to the news agency Bloomberg, Fed officials are ready to exceed the proposed targeted inflation rate for the sake of raising interest rates. This, in turn, will have an inevitably impact on the growth of gold prices within the next few months.

On Thursday, 7th of June, the price of the yellow metal reached $1,298 per ounce.

Experts associate an unprecedented revival of the gold market with an ongoing political crisis in Italy. Euro-sceptics benefited from the disunity of the government. Instead of initiating a trade war, it is predicted that Italy will exit the European Union.

The new Italian government, led by the Chairman of the Council of Ministers Giuseppe Conte, has already refused to comply with a number of Brussels demands. Parliamentarians demand to write off the debt of 250 billion euros owned to the European Central Bank and to abolish budget restrictions that are in force since 1992.

Prospects for the development of the global gold market are radically changing. According to Goldman Sachs analyst Eugene King, gold mining companies are preparing for a new era of geological research.

"The process of gold mining has become way more time consuming. The remaining gold on earth will now be extracted in completely different ways."

The head of Goldcorp Inc. Ian Telfer is convinced that it is possible to take advantage of the current situation:

"Gold, as a metal, becomes even more rare than ever before. Its uniqueness increases its value and, as a result, boosts its price. This could lead to an increase of gold prices up to $1,600 by the end of 2018."

On Friday, 8th of June, gold stopped at the $1,299 an ounce mark.

Gold becomes the basic pension insurance in various countries. The Swiss Pension Fund (AHV pension scheme) plans to increase the amount of physical gold in its investment portfolio to the amount of 30,5 billion euros. The decision was premised upon the fact that gold serves as the best tool for diversifying and protecting the assets of depositors.

Mike McGlone, an analyst at Bloomberg Intelligence and a gold expert is confident that the yellow metal will demonstrate an upward trend.

Mike McGlone, the founder of McGlone Advisors:

"I believe that the precious metal has good prospects for the further growth. One should not forget that the price of gold has grown by 22% since the Fed's interest rates have risen, and major world powers are continuing to build up gold reserves to wait out the unstable times."

On Monday, 11th of June, gold was worth $1,295 per ounce.

Gold is a guarantee of financial security in times of crisis.

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