Global markets have experienced a sharp decline since January 2020 with the impact of the Covid-19 pandemic, while investors turned to precious metals as a safe haven. As historical records were seen in gold prices, there were signs of a return to the old days as news of vaccination became frequent.
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ISTANBUL (TR) - The impact of the coronavirus (Covid-19) pandemic on economic markets will reach $ 12 trillion this year and next year, according to the International Monetary Fund (IMF) sources. Known as a safe haven in the world markets, gold repeatedly refreshed its historical records during the pandemic period. Noting that gold was traded at 1520 dollars at the beginning of 2020, Economic Policy Expert Dr Aziz Hatipağaoğlu said, "As the coronavirus pandemic began to affect the world, investors turned to gold, which they saw as a safe haven. The price of gold rose to a record high of 75 an ounce in August. In the same period, the sale price of a gram of gold in Turkey also broke a record and saw 509 liras.”
Examining the reasons for increasing the global gold prices, Dr Aziz Hatipağaoğlu said, “Due to the high indebtedness rates of companies and states around the world, the continuation of the troublesome process in many sectors with the coronavirus pandemic, devaluations in foreign currencies, precious metal market speculation such as gold and silver, insufficient physical supply in the global market and the need for investors to seek shelter in a safe haven, precious metals such as gold have attracted considerable attention since the beginning of 2020 and have been the most profitable investment for their investors.”
Stating that the global increase in gold prices stopped as of september, Dr Aziz Hatipağaoğlu said, “The fact that the news about the coronavirus vaccine came from Russia first and then China, was effective in returning to normal levels in the US and European stock markets, which showed a record decrease with the first effects of the coronavirus pandemic. It is expected that vaccine news will come from the USA and the UK in a short time. With the production of the vaccine and the return of the production to full capacity, an ounce of gold may fall below 1800 dollars.”
Stating that global investors should turn to stock markets to reduce the effect of the fear left by the coronavirus in the markets, Dr Aziz Hatipağaoğlu said, “Global markets can start to take a sigh of relief since investors leave their precious metals as safe havens. Then, the abundant money supplies that will be seen in global markets will raise interest rates. The return of international trade to its old days instils confidence in the markets.”
Drawing attention to the fact that the world's total gold reserves exceeded 35 thousand tons in 2020, according to the list prepared by the World Gold Council, Dr Aziz Hatipağaoğlu said, "The USA owns 79% of the world's gold reserves and has a total of 8 thousand 133 tons of gold reserves. Germany ranks second with 3 thousand 363 tons of gold reserves, while the International Monetary Fund (IMF) ranks third with 2 thousand 814 tons of gold reserves. Turkey is ranked 12th among the countries with the most current gold reserves in the world with 583 tons of gold reserves.".
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