Why was the gold price so volatile in 2016?
Duncan Richardson, News Editor
4 Jan 2017, 10:26 a.m.
Gold was a top performer in the first half of 2016 as safe haven bids drove the price from a depressed £732 per ounce at the turn of the year to £851 per ounce on the eve of Brexit. The decision to leave the EU surprised the markets and gold denominated in sterling exploded overnight to over £1,040 per ounce.
The gold price traded sideways for the remainder of the summer and then rallied to a 5-year high of £1,060 per ounce days before the U.S. election. Despite Donald Trump’s surprise victory on the 8th of November, the gold price declined for the remainder of the year as stock-markets rallied across the globe. Denominated in U.S. dollars the gold price rose $72 per ounce and in sterling £200 per ounce.
2016 was a pivotal year for gold as it ended the multi-year decline. The gold price had been in a four-year bear market after reaching a new all-time high in August 2011.