The price of gold futures increased by 1% early this morning as investors sought safe-haven assets in light of concerns over the bankruptcy of Silicon Valley Bank (SVB), a US bank that lends to technology startups.
The news of SVB’s closure and assignment to the Federal Deposit Insurance Corporation (FDIC) as the bank’s deposit custodian, following an announcement by the California Department of Financial Protection and Innovation over the past weekend, has spurred investors to turn to gold.
As a result, gold futures rose $18.70, or 1%, to $1,885.90 per ounce.
Despite the uncertainty surrounding SVB’s bankruptcy, the US Treasury has assured citizens that their deposits with the bank are fully protected, and this protection will take effect from Monday 13 March onwards.
The rise in gold futures indicates that investors are looking for secure assets to protect their investments in the wake of SVB’s collapse, with gold being a traditional safe-haven investment during times of financial turmoil.
As the situation surrounding SVB continues to develop, market analysts predict that the price of gold futures will remain high as investors seek stability in the face of uncertainty.
The Spot Market is Open
Monday March 13, 2023