At the end of Friday’s (March 17) trading session, the price of gold approached US$2,000 per ounce.
Precious metals closed at $1,988.18 on Friday, up 3.6% on the day.
Gold’s approach to the coveted US$2,000 mark is behind the collapse of Silicon Valley Bank (SVB) and signatories, pushing investors into safer asset classes throughout the week.
Gold started to rise late last week as rumors of an SVB struggle came to fruition and continued until the collapse of the undersigned bank on March 12th.
Yellow metal broke the US$2,000 level for the first time in mid-2020 due to the impact of the COVID-19 pandemic on the global economy. Last year he surged past that point in March.
What happened to SVB?
SVB was known for its deals with startups, venture capitalists and technology companies. That collapse is not only hurting the broader market, but also the technology sector, which is heavily reliant on financing.
The bank was closed by regulators on March 10 following a cash shortage that it identified itself. The U.S. government said he would officially begin a seizure of the bank two days later, and that those with accounts now have access to the funds.
SVB failure is the second largest There have been bank failures in the United States, with Signature being the third largest.
Tips for investors
As another major financial event triggers momentum in gold, it will be important for investors to monitor their portfolios and adjust in response to shockwaves passing through the market.
Experts now turn to next week’s US Federal Reserve (Fed) meeting for clues as to what happens next for gold. A rate hike of 25 basis points was previously widely expected, but experts are now divided on what will happen.
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Stock Disclosure: I, Bryan McGovern, do not make direct investments in the companies mentioned in this article.
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