The gold market is seeing a consistent hike in its stock prices with a sharp increase of USD 24.60 on 2nd June. This trend is partly due to the constant decrease in the US dollar index as fears of recession loom over the stock market. 

At the start of this week, the gold price was standing at USD 1,830 an ounce, but it made a quick recovery before the weekend and now stands at USD 1,873.30 an ounce. Contrastingly, the US dollar took a hit on the same day and was last recorded at 101.87 after a decline of 0.61%.

According to the ADP National Employment report, there was a very small rise in the United States nonfarm payrolls in May. This information is pertinent for gold investors because it may push the Federal Reserve to decrease the interest rate, which will take gold prices to further heights. 

Stock market analysts are worried that recession may be inevitable because the Federal Reserve continues to tighten the monetary policy while economic growth is already slowing down. Jamie Dimon, CEO of JPMorgan Chase, is afraid that the American economy is going to be hit by a ‘storm’ soon which even the Federal Reserve may be unable to handle. Dimon fears that the Ukraine war may worsen the conditions by pushing the prices of commodities even higher, taking crude oil between USD 150–175 per barrel.

United States Treasury Secretary Janet Yellen has recently confessed that she had mis-anticipated the progress of inflation in the country. Analysts are concerned that after making this grave mistake, the government may try to fix it by stimulating the economy with more incentives. This may worsen the situation because the current high inflation is already a result of excessive stimulus by the Federal Reserve.

Market analysts are convinced that gold is the only safe investment option in these economic conditions because it has already displayed sustained growth after the war in Ukraine.  

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