Gold and silver prices have been on the rise since a low point was
hit in the middle of March.
Kitco reports the price of gold closed at $1,257.65 per ounce April
4, up from a $1,198.80 close on March 15. It’s the highest closing
price of 2017 for gold. The previous 2017 high was a $1,257.55 close
on March 27.
Silver’s April 4 closing price of $18.34 tied a 2017 high that was
previously hit on Feb. 27. The price of one ounce of silver stood at
$16.89 on March 10.
Overall in 2017, gold has risen 9.3 percent from a closing price of
$1,151 on Jan. 3. Silver is up 15 percent from its $15.95 close on
What is behind the rising gold and silver prices?
We reported on March 15 that a coming interest rate hike by the
Federal Reserve could have contributed to the drop in gold and
silver prices during the first half of March.
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However, political turmoil in Europe and continued uncertainty about
President Donald Trump’s policies have been working in favor of gold
and silver, and even the Federal Reserve rate hike was not expected to
discourage precious metals prices for long.
“Typically, once we get the reality of the rise, the dollar starts
to ease off a little and gold tends to recover, and that’s exactly
what we’re expecting this time,” George Milling-Stanley, head of Gold
Strategy at State Street Global Advisors, was quoted by Reuters as
saying in the midst of March's gold and silver struggles.
The fight against the paper dollar has been
renewed: Inside Coin World:
Newly introduced legislation on Capitol Hill is not the first
attack on the paper dollar. Calls for its elimination have been
voiced since the 1970s.
Gold and silver had both been on a tear during the first months of
2017, before the rate hike became imminent, so it could be that
the March dip was just a road hazard that gold and silver needed to
get past, before accelerating back up to the speed they were traveling
in January and February.
Why people invest in gold and silver
Investing in gold and silver has historically been viewed as a hedge
against the unpredictability of the overall economy, and in turn, a
safe haven when other markets experience a downturn.
Gold is valuable. That is based on the fact that we know there’s not
a lot of it, and we know it is appealing to people. So while the
health of someone’s investments in the stock market is subject to the
performance of the companies invested in, gold is a known commodity
with a value that, while it does fluctuate over time, generally does
not fluctuate with the suddenness that a company’s stock can.
While still a hard asset that can serve as a hedge, silver is much
less valuable than gold and its price is more prone to relatively
large swings in the percentage of its value, up and down.