As concern over inflation and the weakness of the dollar lingered gold prices surged past the $1,000 dollars per troy ounce mark in 2009 for the first time. The bleak economic outlook fuelled the rise in gold prices exponentially as most people sought refuge in the precious metal as it has always been considered a safe against inflation during times of economic turmoil. Gold prices were bumped up further when a United Nations panels debunked the greenbacks global reserve currency position, driving fears of a total economic collapse that would render the dollar worthless.
The global financial crisis had finally arrived and it was going to stay and by the beginning of the last quarter of 2009, the prices of gold had already hit the 1000 dollar mark and with the next few month by December, gold prices would have increased by a another 100 dollars per troy ounce, making it the biggest leap in the smallest time frame. The volatile financial markets which resulted in huge corporations such as Bear Sterns and JP Morgan running for the hills started a bull run that would last 3 years during which time the prices of precious metals would grow as never witnessed before.
Although in the midst of October 2009 there was a sign that things would turn around when demand for gold fluctuated causing it to tumble to $720 an ounce along with other commodity markets while the dollar rallied – it was only the calm before the storm. As prices bottomed out in November 2009 and the financial system began fracture from all sides gold was poised to make a comeback breaching the predictions of gold prices holding firm at around $1,000 by far, very far.
Efforts to stifle the increase in the price of gold were futile as the entire global economy melted into chaos.