The gold price is currently trading at just under US$1,775 per ounce after its strongest trading week in over a year.
Gold has been under some pressure as the US Federal Reserve has pursued a dogged policy of pushing up interest rates.
As a hard asset, gold offers no yield, lessening its attraction to investors in times of higher interest rates.
What’s more, as the Fed has pushed the button on stronger rates, US Treasuries have also benefitted.
However, all is still not well in the US economy.
The most recent data shows there have been two consecutive quarters of negative growth, which in most peoples’ eyes – though not the Biden White House’s – amounts to a recession.
With the risk of nuclear war still simmering in the background as conflict with Ukraine continues and China sabre rattles over speaker Pelosi’s mooted trip to Taiwan this weak, the attractions of gold as a safe haven have returned to the fore.
As it stands, though, interest rates are likely to go higher still as the year rolls on, which may put further pressure on gold.
On the other hand, with inflation still running high, gold’s attraction as a hedge is unlikely to diminish.