Gold is shining with the spot price closing in on its 7-year-high at $1,700. Bullion rallied after the announcement of the Federal Reserve’s new coronavirus stimulus. Another $2.3 trillion of lending will be in the system to soften the impact of the pandemic emergency. As mentioned in previous comments, markets are understanding and pricing in every day that central banks will be forced to create a huge amount of new liquidity. The amount of cash in circulation is growing much quicker than the gold, which of course cannot be printed. Gold production is increasing the amount of gold in circulation by less than 2% per year, while the monetary mass is dramatically increasing week by week to mitigate against the impact of the virus.
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