The gold price is on a collision course with its highest level since April 20, and the market is still recovering from the collapse in crude oil prices.
On Thursday, the U.K. and other major gold producers cut prices for a second straight day, signaling that global investors have a better idea of what they’re buying when they make their purchases.
That also means the price is likely to rise again.
If the price does not fall by the end of the week, it will likely be around $1,800 an ounce by the time the year ends, according to a Bloomberg report.
Gold futures have rallied on Wall Street for weeks now, driven by investors who fear the Fed will raise interest rates again.
The central bank raised rates twice in 2017 and twice in 2018.
The latest move, on Tuesday, was the latest in a string of moves by the central bank that have fueled the market’s volatility.
Gold is on track to hit $1:2,000 an ounce this year.
That’s well above its previous peak of $1.28, set on Sept. 20.
The price was last hit in February 2018, and it has since climbed again.
That rally in gold is largely due to investors buying more than the market could bear.
The dollar, which has been the main driving force in the gold price, is down more than 20 percent against the greenback this year and is trading near its lowest level since September 2018.
That means the gold market is a very expensive bet for most investors.
The only exception is those who hold gold futures, which have seen strong gains since the financial crisis.
The price of gold will likely fall further if the U and Europe both lower interest rates, and oil prices remain in a bearish bear market, the Bloomberg report said.
If that happens, gold could trade around $2,200 an ounce in the next 12 months.
The current rally is largely based on the market believing the Fed’s decision to increase its benchmark interest rate is temporary, and that the central banks’ decision to hike rates could come again.