The price of gold has surged to new heights, with a single bar now valued at $1 million for the first time. This milestone comes as the spot price of gold surpassed $2,500 per troy ounce on Friday, marking a record high. Given that the average gold bar weighs 400 troy ounces, the math brings the value of one bar to $1 million.
According to Bloomberg News, which first reported on this development, gold prices have increased by over 20% year-to-date. This spike reflects investor anticipation that the Federal Reserve may soon lower its benchmark interest rate. Additionally, central banks, particularly in China, are purchasing gold to reduce reliance on the US dollar.
Gold is widely viewed as a stable, long-term store of value, particularly during economic uncertainty. When interest rates decline, gold typically becomes more attractive than bonds, as falling rates tend to drive up the metal’s price.
Investors also see gold as a hedge against inflation, with the expectation that its value will hold steady even as prices rise.
However, it’s worth noting that not all gold bars weigh exactly 400 troy ounces. The United States Gold Bureau points out that gold bars are primarily traded internationally by central banks and bullion dealers, rather than individual investors.
