Gold price experienced during August one of the biggest rallies in 2011. During
August gold price nearly reached the $1,900 mark; silver price also inclined
mainly in the second half of August, and even passed, at one point, the $43
mark. What were the main factors that contributed to these large gains during
August? Much like in July, the sharp rises in gold price, had little to do (at
least directly) with the fluctuations in US dollar against major currencies, and
more to do with the speculations around the recovery of the US Economy, the
ongoing debt crisis in Europe and the sharp falls in the US Stock markets. As
the uncertainty in the financial markets inclined during the month, more traders
pulled their funds from the stock market and invested in gold, silver and US
Treasury bills.
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