INTERNATIONAL MARKET – An ounce of gold at 10,700,000 ariary

INTERNATIONAL MARKET – An ounce of gold at 10,700,000 ariary
INTERNATIONAL MARKET – An ounce of gold at 10,700,000 ariary
On Monday, an ounce of gold was trading at 10,700,000 ariary.

How far will the bidding war go? In any case, on Monday, the price of gold exceeded the mark of 10,560,000 ariary per ounce (28.35 grams). A new historic record which increasingly confirms the upward trend in international prices. But also the geopolitical situation which is becoming more and more harmful with several conflicts breaking out in various regions of the globe. Currently, commentators and stock market participants are wondering whether this rapid increase could propel gold prices to break new records, or even reach 13,200,000 ariary. Difficult to say at the moment.

Analysts from Goldman Sachs indicated that prices could reach 11,880,000 ariary. Citigroup, for its part, maintains that the price of the yellow metal could reach 13,200,000 ariary. Nevertheless, the fact is that the surge in gold prices has been lasting, since September 2023, the period when the Israeli-Palestinian conflict began. Economists and financial market analysts are also looking at this trend continuing over time, at least for the coming months.

A bright prospect for African countries producing the yellow metal. This could be an opportunity not to be missed. However, this is a double-edged sword. In its report earlier this month, the African Export-Import Bank (Afreximbank) warned. “Increased flows of foreign exchange reserves generated by exports of gold at high prices may cause an increase in demand for local products leading to an increase in the national money supply without a corresponding increase in production, which translates into inflationary pressures,” the Ecofin agency reported in its columns, summarizing the Afreximbank report. Rising gold prices could also encourage illegal mining and export of the yellow metal. Although this benefits all sectors of the economy.

Itamara Randriamamonjy

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