Have you been keeping an eye on gold prices lately? If not, you might be surprised to learn that gold has hit new record highs, fueled by several key factors that have investors rushing to this timeless safe haven. Growing uncertainties surrounding the Middle East conflict, concerns over the upcoming US election, and a wave of central banks easing their monetary policies are all playing a part in this surge.
As the world watches these events unfold, the demand for gold is rising. Historically, gold has been a reliable store of value when everything else seems volatile. As central banks—especially the US Federal Reserve—cut interest rates to stimulate their economies, gold tends to perform well. This is because low interest rates reduce the opportunity cost of holding gold, which doesn’t pay dividends or interest, making it more appealing.
Let’s talk numbers. Spot gold prices rose 0.32%, reaching $2,730 per ounce, while gold futures on the Comex climbed by 0.59% to $2,746 per ounce—new record highs for the fourth straight day! These figures point to a strong, sustained rise in gold’s value, and many analysts believe it’s not over yet.
Here’s an interesting thought: why does gold react so strongly to central banks’ decisions? Recently, the People’s Bank of China (PBOC) cut its benchmark mortgage rates more than expected, causing commodity prices—including gold—to jump. And it’s not just China. Central banks worldwide, like the European Central Bank (ECB) and the Fed, are lowering rates to try and stimulate their economies.
Another driving factor behind gold’s meteoric rise is escalating geopolitical tensions. For example, in the Middle East, increasing conflict—like the recent Hezbollah drone explosion in Israel—is pushing investors toward gold as a hedge against instability. Even the upcoming US presidential election has markets on edge, with polls indicating a tight race. Historically, periods of political uncertainty tend to benefit gold.
Given the current environment—uncertainty in global politics, central banks easing, and ongoing conflicts—it’s hard to predict where gold will go next. But many analysts think gold’s rise could continue. With interest rates at historic lows and economic uncertainty showing no signs of disappearing soon, the conditions seem favorable for gold to remain in the spotlight.
My Stock Pick for November: Element79
Element79 Gold (CSE: ELEM) (OTC: ELMGF) (FSE: 7YS) Gold is advancing in the precious metals sector, focusing on gold and silver. With both near-term production and long-term exploration projects, the company is poised to generate revenue while expanding its resource base. Its flagship Lucero Mine in Peru, known for its high-grade deposits, is set to resume production soon. Historically, Lucero produced 40,000 ounces of gold equivalent annually, with an average grade of 19.0 grams per ton in gold equivalent. The mine’s underground workings extend over 16 kilometers, highlighting its significant reserves.
Element79 Gold has outlined an ambitious plan for its upcoming activities, starting with a financing round of up to CAD $2,000,000, aimed at funding the fall-winter work campaigns. The funds will be allocated with 60% towards drilling and 40% towards project management, operations, and investor relations. The company plans to kick off a 2,000-meter inaugural drilling campaign at the Clover project, building on results from 104 shallow holes to begin resource discovery.
In addition, Element79 is focusing on completing due diligence for the tailings with the potential to generate immediate revenue through a Mineral Resource Estimate (MRE) and Preliminary Economic Assessment (PEA). The company also plans to negotiate community contracts to secure surface rights for 3 to 10 years, ensuring long-term access to mining sites.
At the Lucero Mine, a 1,000-meter inaugural drilling campaign will target resource discovery while mapping and preparing for surface drilling by 2025. Furthermore, Element79 will assess data from Lucero, Clover, and tailings to refine its plans for 2025, including further drilling, MRE updates, and PEA preparations. The permitting process for plant construction, tailings processing, and surface drilling is expected to take 4 to 6 months, ensuring that the groundwork is laid for future operations.
Gold or Treasury Bonds?
Bank of America analysts suggest that the increasing U.S. debt-to-GDP ratio, along with rising bond yields, may push more investors toward gold. As the Treasury sells more bonds, yields rise, and bond prices fall. Historically, this would hurt gold, but now, even with higher rates, gold remains strong. In fact, BofA predicts gold could hit $3,000 per ounce, calling it the “ultimate safe-haven asset.”
Gold has surged more than 30% this year, reaching $2,700 per ounce. This rise continues despite the U.S. budget deficit reaching $1.8 trillion and interest payments on the national debt climbing to $950 billion.
As central banks worldwide diversify their reserves away from U.S. debt, gold’s appeal grows. With spending pressures from climate change and defense needs, the future may see gold as the last standing safe investment. Bank of America notes, “If markets become reluctant to absorb all the debt, gold may be the final safe-haven asset.”
