In the markets, fears over the spread of COVID-19 have led to a widespread selloff of risky assets. Meanwhile the safe haven of gold has hit its highest level in seven years. Analysts say that the rising trend in gold prices is likely to persist, as the epidemic shows no signs of abating. Amid COVID-19, demand for safe-haven assets has skyrocketed. The price of gold soared from US$1,600 per ounce on Feb. 18, to the seven-year high of US$1,691 on the 24th. Gold has since dipped to about US$1,645 per ounce. But analysts say it’s likely to climb again.Chen Yu-chungFinancial analystOver the past one or two days, gold prices have gone down again somewhat. At the moment it seems that gold will hold steady above US$1,650 per ounce. But currently there’s no indication that the epidemic is reaching containment. If gold surpasses US$1,700, we’ll be looking at breaking a record more than seven years old, from 2012.Analysts say gold could rise to top the 2012 price of US$1,930 per ounce.Chen Yu-chungFinancial analystSafe-haven assets typically include the U.S. dollar, the Japanese yen, the Swiss franc and gold. Currently, all physical currencies including the Swiss franc have fallen. For instance, Switzerland has been affected by the epidemic. It has confirmed cases now. The epidemic is out of control in Japan, so the Japanese yen is much less good a hedge. The disease could spread to the U.S., so the greenback is beginning to fall. No physical currency has been able to hold the line. Right now, gold is the only one that can resist the virus.Skyrocketing gold is not necessarily good news. On social media, financial analyst Hsieh Chin-ho said oil prices will likely go up to align with gold, putting pressure on stocks and adding monumental risks to the financial market.
