July 9th, 2020
Spot gold broke the $1,800 mark for the first time since 2011 this week. The move is being interpreted in two ways. First, as a bid for safe-haven assets as daily new coronavirus cases continue to climb. Second, as a hedge against inflation and currency debasement as central banks and governments flood their economies with money (the UK just announced a $38 billion stimulus package to combat unemployment). Deutsche Bank points out U.S. money supply is up 25% year-on-year - according to them, this is only the tenth time in the past 190 years money supply is running above 20%. Still, inflation in the G4 group of economies remains well below the 2 percent mark their central banks have chased over the past few years.
Chart and commentary by Ritvik Carvalho
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