The gold price is trending upward again in the wake of a weakening US dollar and worldwide quantitative easing (QE) practices, with central banks moving assets away from the dollar to other currencies and gold.
YLG Bullion International's chief executive Pawan Nawawattanasub said the rise of gold prices is a result of surging infections around the world that will continue to hamper the global economic recovery and drive the Fed's continuation of QE.
"With a continued loose monetary policy in the US, the dollar will depreciate compared with the pound, especially as the UK recently agreed to trade measures after Brexit," said Mrs Pawan.
US President Donald Trump recently signed a new round of fiscal stimulus worth US$900 billion, while the next administration under President-elect Joe Biden is expected to continue with a third economic stimulus package.
The issuance of US fiscal stimulus results in a higher expectation for inflation, driving investors to move to gold as a hedge against likely inflation, she said.
Another factor driving the price is SPDR Gold Fund's buyback of gold at the end of 2020, said Mrs Pawan.
In 2021, foreign analysts project the gold price will continue to rise on the heels of dollar depreciation, while many central banks around the world have reduced their capital reserves in the dollar and turned to other assets, including gold.
"Gold prices will continue to uptrend for the next 1-2 years, and the interest rate will remain low until 2023," said Mrs Pawan.
She said the resistance line for gold is $1,965 an ounce.
If the line is passed, the price will rise up to $2,000 an ounce in the short term.
MTS Gold Group's chief executive Nattapong Hirunyasiri agreed gold prices are likely to rise to $2,000 an ounce soon thanks to the weakening dollar and the US government's QE.
Gold prices have risen 3% year-to-date and are likely to reach $2,000 an ounce in the short term, with a chance of hitting $2,200 an ounce in the medium to long term, said Mr Nattapong.
The Democrats' victory may also drive the gold price to rise as it allows President-elect Joe Biden to increase the corporate tax rate and enact environmental protections.
While violence from Republican supporters caused gold prices to fluctuate yesterday at about $1,920, down from $1,960 an ounce earlier this week, the price will continue to rise in the long term thanks to the continued economic stimulus.