Biden far outstrips Trump, gold prices will ‘explode’



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Jakarta, CNBC Indonesia – The counting of votes for the US presidential election is still ongoing. At the moment, Joe Biden is still in good shape. popular vote neither electoral vote. The price of gold is preparing to rise.

On Thursday (11/05/2020), the price of gold on the spot market rose 0.21% from yesterday’s closing position. At 09.05 WIB, the yellow metal is priced at US $ 1,907.23 / troy ounce.


According to the Associated Press (AP), Democratic presidential candidate Joe Biden has obtained 79.1 million popular votes and 264 electoral votes, while his Republican rivals obtained 68.5 million popular votes and 214 electoral votes.

The victory of the Democratic Party, which formed the executive and legislative ranks, that is, the House, will be occupied by the blue party field so that it can further pave the way to eliminate the supermassive economic stimulus of Volume II in the US. .

Previously, the discussion on the second stimulus volume found no common ground because each party had a nominal proposal for the size of the aid package, with Democrats, of course, being the largest, at a value of $ 2.2 trillion. .

Stimulus is the main keyword, gold may strengthen 25% this year. Expansive fiscal and ultra-lax monetary policies have a number of consequences in the market.

The high number of liquidity injections into the financial system has weakened the US dollar. Expectations of future high inflation are rising. At the same time, the policy of buying financial assets in the form of US government bonds caused real yields to fall into negative territory.

This condition is a good ecosystem for gold as an asset. Safe haven Y coverage of currency devaluation due to inflation and various risks of global uncertainty.

Gold is anticipated to have the potential to return to its highest level ever at US $ 2,000 / troy ounce. According to the COO and co-founder of Digix, a digital gold trading platform, Shaun Djie said that gold will return to its highest psychological level once the elections are over and the winner is known.

The catalyst that brings the price of gold back to that level is an increase in global cases of Covid-19 infection. The second wave of Covid-19 made the prospects for economic recovery bleak.

Next year, the sentiment that will drive the price of gold is the distribution of the Covid-19 vaccine. If a vaccine is available and its distribution is as expected, Djie estimates that the price of gold will drop to US $ 1,600 / troy ounce, as he said in an interview with Kitco News.

But if the opposite happens, the price of gold is ready to skyrocket higher.

CNBC INDONESIA INVESTIGATION TEAM

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