Gold Hits Record High – Mining Zimbabwe

Gold miners will be smiling all the way to the…

Gold miners will be smiling all the way to the bank as gold prices surged to unprecedented levels, due to a combination of factors that underscored the metal’s status as a safe-haven asset.

This is good news for primary producers and over 500 000 Artisanal and small-scale miners that contribute an annual average of 60% of the total gold deliveries to Fidelity Gold Refinery (FGR) the country’s sole gold buyer.

The catalyst for this surge was a softer-than-expected U.S. inflation reading, which solidified market expectations of an imminent interest rate cut by the Federal Reserve of America.

At 0529 GMT, spot gold was trading at $2,258.12 per ounce, marking a significant 1.2% increase from previous levels. During the session, it reached an all-time high of $2,265.49, underlining the strong investor appetite for the precious metal. Con-currently, U.S. gold futures rose by 1.8% to $2,279.10, reflecting similar bullish sentiment in the futures market.

The surge in gold prices can be attributed to the growing anticipation that the Federal Reserve will implement its first interest rate cut of the year in June. This sentiment gained traction following the release of U.S. inflation data that fell below market expectations. Lower inflation typically signals a dovish stance by central banks, as they seek to stimulate economic growth by reducing borrowing costs. Consequently, investors turned to gold as a hedge against potential economic uncertainty and currency depreciation.

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The record-breaking rally in gold also reflects broader market concerns regarding geopolitical tensions and trade disputes. Amidst these uncertainties, investors traditionally seek refuge in assets perceived as safe havens, with gold being the foremost choice due to its historical resilience during times of crisis.

Currently commodity prices are soften leading to job cuts and in some instances mine closures. For the first time in more than a decade, in 2023 gold generated more foreign currency than platinum in Zimbabwe.

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