The price of Gold in the last 3 years has been in a decline, this could change if the United Kingdom vote in favour of Brexit, which according to polls looks increasingly likely to happen. Over the years during economic stress gold has been a safe haven for investors, and the price could rise if the nation leaves the European Union, which is only a couple days away.
Despite the economic turmoil of the global financial crisis, gold reached a record high before reaching a peaking in September 2011 at $1900 per ounce. As the financial crisis subsided, the price of gold was around declined. In November 2015, the price of gold was around $1050, despite the uncertainties over financial crisis subsided which was around the time the Fed tightened the cycle. With the rates being raised in December, the price of gold even rose at its fast rate despite news of China’s economic weakness at the start of the New Year and the stock market turmoil.
The United States dismissed a report some days ago which had raised doubts over the state of the United States economy and lowered the odds that rates will be raised later this month. The price of gold rose; it was its biggest jump in 11 week. Its price is around $1247 per ounce. Analysts say that potential negative impact of the United Kingdom leaving the European Union could send the price of gold to rise up to $1400 per ounce.
There has been numerous warning about the negative economic impacts on Brexit from the Bank Of England, World Bank and Barack Obama the United States president. According to the International Monetary Fund (IMF), the economy could shrink by 1% to 9% over a long term if Brexit occurs. With the global economy in its fragile state and the polls edging stronger on the United Kingdom leaving the European Union, it makes the future of Europe looking very uncertain. The financial markets are likely to be increasingly volatile. With Brexit looming, gold can be a safe heaven.