Gold extends gains above $5,000 as debasement trade gathers pace

Gold stays above $5,000 an ounce as investors flee bonds and currencies amid geopolitical risk, while silver surges on strong investment demand

Gold rose for a second consecutive day, holding above $5,000 an ounce as geopolitical risks and a flight from sovereign bonds and currencies extended the metal’s rally. 

Bullion climbed as much as 1.8 per cent on Tuesday for a seventh straight day of gains, while silver jumped more than 9 per cent. Strong investment demand has sent precious metals sharply higher this month, with silver up 57 per cent since the start of January. 

Gold and platinum have also posted significant advances. Recent weeks have seen a revival of the so-called debasement trade, as investors retreat from currencies and treasuries. 

 

A massive selloff in the Japanese bond market is the latest example of concerns over heavy fiscal spending, while speculation that the US may intervene to support the yen has weighed on the dollar, making precious metals cheaper for most buyers.