Gold prices surged to an average of $2,580/ounce on Friday; the highest level as more investors seek a hedge on the back of a soft dollar and falling bond yields. The sharp rise in gold prices can be attributed to the actions of parties in world markets where they are looking for safe-haven instruments and as expected gold has remained a preferred option for value storage in those volatile periods.

Some of the reasons that led to the rise of gold include the weakened dollar. A weakening of the U. S. dollar increases the price of gold for the international buyer pushing the prices up due to increased demand. Because of the dollar’s weakness caused by unpredictable economic indicators and a relatively accommodative Monetary policy from the Federal Reserve, investors have shifted towards gold as a safe haven from currency devaluation and inflation. This has been made worse by low bond yields which lower the cost of forgoing or foregone returns on assets that do not pay an income such as gold.

Another factor that continues to drive gold prices up is the current instability and unrest around the globe and concerns on future economic growth. Fluctuations in the stock market have been witnessed lately, and this has been the main reason investors are opting for gold as a more conformable asset portfolio. It is important to know that more of the central banks across the world are also investing in gold to diversify their portfolio, again adding support to the already bullish sentiment in the gold market.

Gold has reached $2,580 per ounce first and foremost, based on today’s factors, but also on long-term expectations of reassurance in gold as a safe asset. With this milestone, people are reminded of how gold remains popular, especially during hard economic periods. As long as the dollar remains weak and bond yields remain low gold prices are likely to remain high thereby making investors to continue observing the market for the next big move in the price of gold.