For some it is a safe haven, for others it is "not particularly useful and not productive". Among the latter is, for example, the stock market shark Warren Buffett, who believes that gold is not particularly valuable - as long as it does not bring profits, unlike stocks and government bonds.
However, in a moment, a real "storm" to gold - on Friday its price exceeded 2,500 dollars per ounce, i.e. is as high as it has ever been. Since the beginning of the year, gold has risen in price by 20 percent, informs ARD.
Investors are expecting a drop in US interest rates
Financial analyst Carsten Fritsch names one of the reasons: "The strongest incentive is the expectation that the Central Bank in the USA will start reducing interest rates, and seriously, as early as September". Meanwhile, the market expects a drop of at least 25 basis points in interest rates in September and a total of 100 basis points by the end of the year.
When the interest rates in the capital market are high, investments in gold are rather inefficient because it does not bring income. But if interest rates fall, the precious metal becomes interesting again, ARD points out.
Anxious look at the Middle East
Added to this are geopolitical uncertainties and, first of all, the Middle East conflict. Concerns about an escalation of the situation are causing many investors to increase their holdings in gold, Fritsch said. "Gold as a safe harbor and tensions in the Middle East are factors in the increase in the price of gold, as it is in uncertain times that safe harbors like gold are sought."
The financial analyst tells ARD that not only private depositors and large investors have recently shown interest in gold reserves - and some central banks, especially in Asia, are contributing to the increase in demand, respectively to the rise in prices.
Developing countries are also looking for it
"On the one hand, the share of gold in the foreign exchange reserves of developing countries is still relatively limited - much more limited than in industrialized countries. I.e. there is a need for diversification - to reduce the share of dollar reserves", Fritsch points out. "This is why some of the developing countries have been buying record amounts of gold in the last two years." And this is another factor for its increase in price.
Investment boss Buffett also has his own interpretation of things, notes ARD. German social media quoted him as saying that in the case of gold, it's about betting on fear. What motivates most gold purchases is the belief that the number of fearful people will increase. From there, the equation is: the greater the fear, the higher the price of gold.
Author: Bianca Von der Au (ARD)