The U.S. government is on the verge of hitting its debt ceiling, an action that would plunge the country into a ‘constitutional crisis’ says Treasury Secretary Janet Yellen. The world’s largest economy is just weeks away from a default – something that is giving the gold bulls huge reserves of strength.
Yellen said, “If they fail to do it [lift the debt ceiling], we will have an economic and financial catastrophe that will be of our own making.”
She had earlier told Congress that, “After reviewing recent federal tax receipts, our best estimate is that we will be unable to continue to satisfy all of the government’s obligations by early June, and potentially as early as June 1, if Congress does not raise or suspend the debt limit before that time.”
This uncertainty is creating a wave of safe-haven demand for gold and could see the yellow metal reach a new all-time high over the next few weeks. Edward Moya, senior market analysis for OANDA said, “gold looks like it wants to make another run towards record territory. Too many recessionary risks are on the table for gold to see a significant pullback.”
Don’t delay. Buy now.
