Posts Tagged ‘Dollar’
Though gold and silver are no longer the currency of everyday use, their prices dictate the current state of the economy. With the recent spate of recessions and economies going on a roller coaster ride, gold and silver prices too have been fluctuating heavily. One of the main reasons for this is buyer sentimentality. Considering that these precious metals are rare and retain their original value plus more, they are often considered the safest investment in a volatile economy. That having been said, there has been a recent increase in the price of gold and silver bullion thanks to the consistent level of purchase by stockists as well as investors.
There is also a strong demand for silver from the industrial sector thus driving up its price. This increase is also compounded by the amount of speculative purchases as well. An observation of the markets will show that even in the European markets gold seems to rule supreme. Another increase for the rise in price of such precious metals is that there is no ceiling on the prices that it can reach, simply because there is no ceiling on the amount of currency notes that can be printed. This is based on the Federal Reserve of America’s announcement and basically influences the way prices go in the international market.
This move to take away the ceiling is what has acted as a catalyst. It has been done primarily to ensure that the American economy comes back on track. The idea is to move towards a kind of progress that will ensure an economy that has ample employment opportunities and a level of price stability. One of the reasons for the Federal Bank going this way is to tackle the pressure that is coming in from the opposing political parties in power. With America’s national debt pushing the $16 trillion mark, bringing down the value of the US dollar seems to be the only way to break the impasse in the economy currently.
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