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Investors are leaving “SAFE HAVEN”: what will happen with gold prices?

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Gold is a safe haven for investors. During political or economic uncertainty, demand for it grows, and when the situation normalizes, accordingly, it falls. We are now seeing a similar situation. Supported by the coronavirus crisis, the price of gold rose and exceeded $ 2,000 in August. Subsequently, against the backdrop of news of successful vaccine trials, gold prices began to fall. As of 11:50 am (Baku time) on November 26, 2020, gold was worth $ 1,814.8 per troy ounce (+ 0.5% per day). In general, compared to the August peak, gold has fallen by 15%.

A further drop is entirely possible. If you look at the charts, you can see clear bearish candles in the last few months.

Also, the news that Donald Trump's administration has decided to begin transferring power to Joe Biden has pushed the price down. As a result, a 4-month low in gold prices was recorded.

According to the World Gold Council, in the third quarter of 2020, central banks became net sellers of gold for the first time since 2010 (gold sales exceeded purchases). That is because some countries wanted to minimize the coronavirus's negative impact on the economy, offsetting losses through gold sales at record high prices. A drop in the gold value to $ 1,700 could again make it attractive to investors, increasing demand and prices accordingly.

The cost of gold may drop to $1,750-1,780, but it is unlikely to fall more than these indicators. After reaching this mark, gold can very quickly return to the growth trajectory.

There are several reasons for this. First, vaccine development will take some time, and current prices do not include the risks associated with vaccine delays. Such a scenario cannot be ruled out either.

Secondly, this year's gold growth has also been spurred on by the risks of increasingly restrictive measures associated with the coronavirus pandemic and enormous spending to stimulate the economy (mainly in the United States). The coronavirus package in the United States was about $ 3 trillion.

Forecasts of international financial institutions are mixed. For example, Morgan Stanley downgraded its forecast for 2021 from $ 1,950 to $ 1,825. Experts at BofA Global Research (part of Bank of America) did not include gold in the list of commodities that could bring moderate returns in 2021. They stake on oil, gas, copper, nickel, and aluminum. However, even according to their forecasts, gold will be worth around $ 2,063 next year.

BCS Global Markets expects $ 2,090 per troy ounce of gold in 2021, Fitch Solutions – $ 1,700.

Based on the preceding, it can be assumed that a serious reduction in the price of gold should not be expected in the medium term, and in the first half of next year, a moderate rise in prices is possible.

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Azerbaijan confirms 402 new Covid cases, 15 died

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Azerbaijan recorded 402 new coronavirus cases, Task Force under the Cabinet of Ministers told Report.

As many as 650people recovered from the infection, while 15patients lost their lives over the past day.

So far, 226,951 people have contracted COVID-19 in Azerbaijan, 214,423 have recovered, while 2,998 died. At present, 9,530 people are receiving treatment.

Azerbaijan has conducted 2,311,417 coronavirus tests over the past period, including 8,574 today.

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Belarus FM, Azerbaijani ambassador moot development of bilateral ties

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Minister of Foreign Affairs of Belarus Vladimir Makei met with Azerbaijani Ambassador Latif Gandilov on January 15. Report informs that press service of the Belarusian Ministry of Foreign Affairs told BelTA.

The parties discussed the schedule of upcoming bilateral visits at the highest and high levels.

Special consideration was given to trade and economic cooperation and its results in 2020. The parties exchanged information on the measures taken in the two countries to counter the spread of COVID-19.

The agenda of cooperation of the ministries of foreign affairs for 2021, including cooperation in international organizations, was also reviewed.

The parties also outlined the steps to further develop Belarus-Azerbaijan strategic cooperation in the political, trade, economic, and humanitarian areas.

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Footage from Shelli village of Aghdam region

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Defense Ministry has released a video footage of the Shelli village of the Aghdam region.

Report presents the footage:

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