PieTrader

Gold has always been one of the most valuable and coveted metals in the world. Scarcity is the main reason for its value. Estimates of global mined gold reserves fluctuate slightly from year to year, but are not higher than 50,000 tons. The countries with the largest estimated reserves are Australia, Russia and the United States. Currently, China is the world's leading gold mining country, followed by Australia and Russia.

Due to profit-taking and a stronger US dollar, gold prices fell more than 1% to $3,015 an ounce on Friday, although they were still on course for a third straight weekly rise. Bullion has increased 0.7% this week despite the decline, helped by ongoing global unrest and anticipation of rate reduction by the US Federal Reserve. Gold has hit 16 new highs this year as a conventional safe-haven asset, and on Thursday it hit an all-time high of $3,057.21 per ounce. The strength of the dollar, which reached a two-week high and increased the price of gold for foreign buyers, was the main cause of the decrease. However, market players still expect at least two rate cuts from the Fed this year, which supports gold's long-term optimistic view. Additionally, escalating geopolitical risks, including renewed conflict in Gaza, have sustained investor demand for the precious metal.

Among gold miners, America's Newmont is the global leader, with nearly six million ounces in production in 2020. Newmont's revenue is $11.5 billion in 2020. Barrick Gold's Canada and South Africa's AngloGold Ashanti are the largest companies, respectively the largest gold producers in the world. We are seeing inflationary pressures now around the world. When inflation occurs, the purchasing power of fiat currency tends to decrease. This leaves investors looking to channel their wealth into more limited assets such as real estate, art and gold. If this inflation is not temporary, then we could see gold outperform other assets over the next five years. Considering that inflation could last for more than a few years, we could see gold move from its current price of $1,930 to $2,300 over the next five years.