Yesterday, gold futures for delivery in June soared by 1.8%, or $31.40. On COMEX, the price reached $1,818.60 and closed at $1,815.70, the high as of February 12.
Silver also approached its February high. The price was up by $0.96, closing at $27,48 on Thursday.
According to analysts, silver's spike above $27 boosted the price of gold. In the last 3 weeks, gold attempted to break the important barrier 5 times, though unsuccessfully.
Another reason for gold's rally was a drop in yields on US bonds. On Thursday, yields fell to 1.57%. Ross Norman, Chief Executive Officer at Metals Daily, expects the 10-year bond yields to go down to 1% in the short term.
The weaker US dollar also contributed to surge. Yesterday, the US dollar index dropped by 0.4% and settled at 90.977, thus making gold more attractive.
Meanwhile, inflation concerns provided additional support to the precious metal. Inflation worries currently outweigh economic optimism. Even extremely positive labor market statistics could not prevent gold from climbing up yesterday. The report revealed that initial jobless claims plunged by 92K last week.
According to Bryan Rich, CEO of Logic Fund Management, a bullish trend in the gold market is highly likely amid the apparent devaluation of the national currency due to the Fed's dovish stance on monetary policy. He expects the price to increase to the level of $2,700 in the long term.
As for the mid-term forecast, gold may well exceed the $1,850 mark already next month. Edward Meir of ED&F Man Capital Markets suggests that a steady rise of the asset will be determined by growing inflationary pressures.
The short-term forecast for gold was also upwardly revised after the price has broken the $1,8K mark. It seems that bulls are not going to give up any time soon.
Early on Friday, the quotes went up. At the moment of writhing, gold futures contracts for delivery in June advanced by 0.29% to $1,821.05. Silver futures gained 0.57%, or $27.633, from the previous session.