It looks like the day that gold will hit that $1,500 barrier has come. A huge precious metals rally was taking place on the New York Stock Exchange on Monday and as of noon time on Monday, the price of gold was at $1,494, up nearly $9. The gold rally is one that has been shaping up for the biggest part of the past week and silver responded as well as it was up nearly 80 cents from last week and was trading at $43.29 an ounce.
The catalyst that is being blamed for this latest price hike is that Standard and Poor's has come out with a report stating that the future outlook for the United States economy is one that is looking very bleak. S & P still gave the United States it's triple 'A' designation but downgraded the outlook for the economy to negative which means that within the next year or two that the country could officially drop from its status as one of the world's leading financially stable countries.
While the high oil prices and inflated food prices are also contributors to the hike in the price of precious metals, another bit of news has also helped. This is coming from the National Association of Home Builders which seen a drop on their market expectations. China is also showing their face card in the global downturn as they have announced that they will raise the reserve requirement for banks in order to battle future inflation.
China is by far the most powerful financial country in the world and when they start showing weakness, that is a sure sign that the world's economy is in dire straits. Gold mining stocks did suffer on Monday as several of the major stocks fell. This is another sign that readily available gold is in high demand just like it has done with the recent hikes in the price of gold.