The price of gold passed the $1,800 mark this morning - a milestone notorious for being a psychological barrier - and has peaked at $1,805.27 per ounce so far in today's trading. This is the highest gold has been since the middle of September 2011, and comes just one week since we reported gold first hitting a nine-year high.

The initial surge in the gold price yesterday afternoon came as the European Commission announced it was cutting all economic forecasts, and told reporters that the Eurozone will experience a deeper recession than was initially expected – declining by 8.7% rather than 7.7%.

While some will argue that Europe's troubles might not be the world's, this is a global pandemic and many of the economic models used to forecast are very similar, suggesting other major nations and regions could experience similar difficulties for the rest of this year and 2021.

The price of gold in US Dollars per ounce for the past 24 hours.

In a recent article for CNN Business, Paul R. La Monica discussed investors flocking to gold and how it is an indicator of stress and skepticism.

“Buying gold could be a good hedge against a potential stock market pullback if the rebound in earnings and the economy doesn’t materialize in 2021 as expected.”

Gold has gained between 16-18% in value so far this year, making it not only one of the best-performing assets but also putting it within $100 reach of the all-time record price. Back in May, industry insiders were airing their concerns over what's to come for economies, with Danny Yong of Dymon Asia Capital telling the Financial Times that the interest in gold is because “Gold is a hedge against unfettered fiat currency printing”.

Since then demand has demonstrably grown, reinforcing gold's position as a safe haven asset. Central banks have resorted to fiscal measures such as printing money and record low interest rates to help economies cope with lockdown and furlough, but the potential for subsequent debasement of money, as well as inflation in the future, has many worries.

While bullion demand has been strong, ETFs have been at the heart of the latest surge for gold. The World Gold Council reports that ETFs have seen positive flows of demand for the past seven months, with 104 tonnes of gold added in June – worth $5.6 billion. The total global holdings of gold ETFs is now at 3,621 tonnes, and the ETF demand for the first half of 2020 alone has been greater than the total central bank buying for 2018 and 2019.

Gold's gains have also benefited stocks in gold mining firms, with the NYSE Arca Gold Miners index reporting an average of 23% gained for companies including the likes of Barrick Gold and Newmont. The consensus appears to be the same across the board – negative returns on government bonds, incredibly low interest rates, and the risk of debt makes gold an appealing asset.