Market insights and analysis

How dynamic, risk-managed investment solutions are performing in the current market environment

2nd Quarter | 2022

Market insights and analysis

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Updates on how dynamic, risk-managed investment solutions are performing in the current market environment.

Last week, gold prices caught back up to their 50-day average. The metal closed the week at $1,791.20 per ounce. 

When Russia invaded Ukraine in February, the U.S. and Europe imposed economic sanctions on Russia, looking to hurt its economy and its currency, the ruble. But these sanctions seemed to have backfired, as the ruble grew even stronger than it was before the war started—in part because Russia backed the ruble with gold.

These sanctions also seem to be leading to other global economic developments, including increased interest in exploring alternatives to the U.S. dollar as a global reserve currency. The Economic Times reported in June that Russian President Vladimir Putin said “the BRICS countries—Brazil, Russia, India, China, and South Africa—are currently working on setting up a new global reserve currency. ‘The issue of creating an international reserve currency based on a basket of currencies of our countries is being worked out,’ he said at the BRICS business forum.” 

This new reserve basket of currencies will, like the ruble, include gold as an anchor. Investors may want to consider anchoring their investment portfolios with gold in case demand increases.

Rick Andrews is president of Avant Capital Management.



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