A break higher for gold amid the pandemic

THE first six months of the year saw a flurry of events. A summary of notable ones include the Covid-19 pandemic which essentially put the whole world on pause; and the stock market crash on Feb 20, which saw the Dow Jones, Nasdaq composite and S&P 500 record the biggest decline since the 2008 financial crisis. In addition, oil prices fell into negative values for the first time.

This bleak outlook generated uncertainty in the market, which in turn led to investor confidence being shaken - causing many to flock into safer and more stable assets.

In these recent months, gold prices whipsawed due to its stature as a safe-haven asset. Gold prices traded to the lows of US$1,452 per ounce, before staging a drastic recovery and rising above US$1,700 an ounce. This was a level that was visited previously in 2013.