The new week began with a new peak for the price of gold. On Monday morning, the troy ounce cost $2,450.07 at times, more than two percent higher than at the end of the previous week. Just a few months ago, in February, the price of gold was still below $2,000.

Several factors have led to this increase:

1. Death of Iranian President

Iranian President Ebrahim Raisi died in a helicopter crash last Sunday. His death prompted market participants to invest more in gold, as it is considered a safe haven. However, the price of gold was already on the rise before this.

Geopolitical tensions in the Middle East also promote the flight to gold.

2. Inflation and Interest Rate Developments in the US

Another factor for the rise in the price of gold is the declining inflation in the US. This led to a change in interest rate expectations. Since gold does not yield interest, even slight changes in interest rate expectations have an impact on it.

3. Gold for Diversification in Emerging Markets

In emerging markets, especially in China, there are also reasons to increase gold holdings. Both central banks and private households are increasingly buying gold to diversify their portfolios and reduce their dependence on the US dollar. It is unlikely that the holdings will be sold quickly.

Volatile Gold Price Development

Although the price of gold is currently high, the outlook remains uncertain. Commerzbank analysts view the current rally as fragile and warn of a possible correction. Overall, the future development of the price of gold is likely to be characterized by high volatility.