Gold Tests 1980 Real Record High as BRICS Push 'New World Order'
Tuesday, 10/22/2024 16:23
GOLD BULLION held at record high prices against a rising US Dollar on Tuesday as Western stock markets fell for a 2nd day, longer-term US borrowing costs touched 3-month highs, and the BRICS group of emerging-economy nations met in Russia to discuss a new "multi-polar" world order.
Matching yesterday afternoon's new London benchmark high of $2736 per Troy ounce around 3pm – the 4th in 4 sessions for the world's gold benchmark – the Dollar price of bullion then rose to a new all-time spot market high of $2743.
Adjusted by inflation, that put this month's average gold price at the 2nd highest on modern records, rising within $30 of February 1980's all-time monthly high of $2689 per Troy ounce in terms of current US Dollars.
US and other Western reserve-currency debt prices fell again, in contrast, pushing up the yield offered by 10-year Treasury debt – a benchmark for government, commercial, financial and household borrowing costs – to its highest in 13 weeks this morning, close to 4.20% before edging back to 4.17%.
Judged against September's CPI cost of living index, that still put 10-year US yields at more than 1.6% above inflation on a month-average basis, matching last October's 9-year real rates record and rising by almost half-a-point in the past 3 months.
Prior to Russia's invasion of Ukraine in early 2022, the real price of gold moved in the opposite direction to real rates almost 2/3rds of the time since 1968 on a 12-month basis.
Since then, real gold and the CPI-adjusted yield on 10-year US Treasury bonds have moved in the same direction, up or down together, three-quarters of the time as nominal bullion prices have soared to new records and Treasury debt values have fallen, pushing up longer-term interest rates.
"Putin hopes this week's BRICS summit will spark a sanctions-busting big bang to defeat the Dollar," says
The Economist magazine, reviewing the Russian President's comments on cross-border payments systems as the US, UK and EU continue to
hit the finances of the Kremlin, its officials and its supporters over Moscow's invasion of Ukraine.
"We believe that BRICS countries have enormous potential," said an aide to Azerbaijan's President-for-life Ilham Aliyev today, speaking to China's state-controlled Xinhua news agency at the 2024 BRICS summit in Kazan, 700 kilometres east of Moscow.
"We are capable of
contributing to the establishment of a new world order based on justice, international law and the equality of countries."
"The world cannot be unipolar."
"International relations," said Russia's President Vladimir Putin last week ahead of hosting the BRICS summit, "have entered the era of global, fundamental changes when
a new world order is being formed, reflecting the diversity of the whole planet."
"This natural process is irreversible."
Central-bank gold holdings worldwide have grown 9.0% by weight since Goldman Sachs economist Jim O'Neill coined the term BRICS as a marketing tool in 2001. The group's 5 current members have grown their officially reported gold reserves more than 4-fold.
Combined holdings among the world's reserve-currency issuers – the US, UK, Eurozone and Japan – have meanwhile shrunk 9.0% by weight.
The
UK gold price in Pounds per ounce today set a new spot-market record at £2117, the Euro price topped €2538, and the Yen price came within ¥3 per gram of ¥13,300 – more than 40% higher from this time last year.
Gold in Shanghai also rose to a new record, setting a fresh all-time high for traders and households in China – the precious metal's No.1 consumer nation – for the 7th session running at ¥624 per gram.
Neighboring Taiwan today
shared its wartime food plan with journalists as China's Navy held
live-fire drills close to the independent island less than a week after conducting large-scale military exercises in the area.
South Korea meanwhile said it's
considering sending military aid to Ukraine to defend against Russia's invasion after Seoul's intelligence services said North Korea has sent 1,500 special forces troops to assist the Kremlin's war.
US documents leaked overnight show President Joe
Biden acknowledging Israeli plans for retaliatory strikes against Iran after Tehran attacked the Jewish state at the start of this month in response to Jerusalem's continued bombardment of Gaza and Lebanon in its war against Iran-backed groups Hamas and Hezbollah.
Iran joined BRICS in January, alongside the UAE, Egypt and Ethiopia.
Hosting this week's BRICS meeting, attended by 24 nations alongside the core five – Brazil, Russia, India, China and South Africa – Russia
hopes to see giant oil-producer Saudi Arabia join the group.
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