Gold is falling and silver is right behind

Published: 27 July, 2015 09:20

The US investment bank Morgan Stanley is concerned that the gold price is in decline and that the price of gold could fall as low as 800 dollars per ounce. News agency Bloomberg writes in an article that the bank believes that the time of high prices for precious metals is over and that a new era will begin with less price stability.

Even investment bank Goldman Sachs has previously expected a decline in prices to come. The head of commodity analysis, Jeffrey Currie, is skeptical when it comes to gold and believes that the worst time is still ahead of us.

There are many reasons behind the falling gold price and the risk of a continued downward spiral. The Greek crisis with its debt-clearing, the collapse of the Chinese stock market, waiting for the first increase of the US rate, and that the risk of deflation is over, are just some of them.

And it is not just the price of gold that is decreasing. The silver price has not been this low for over five years. The collapse of over 30 percent in the past year said to be one of the reasons why the US Federal Reserve, should think t before their interest rate increases.

Spring has been hard for commodities generally, as oil and other metals over time have decreased in value. Gold has lost as much as 17 percent in the past year, and now, the losses are beginning to stand out. A compilation was made last autumn by analyst company Gavekal Dragonomics, when the inflation numbers were substantially down because of oil prices, the price of silver would soon follow.

Many now believe that there is a risk of falling oil prices, and they also believe in a protracted inflationary force when it comes to other commodities. Just look at other downward trends such as copper, down 27 per cent and rubber, down 16 percent.

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