- The yellow metal edged higher on Monday from an 11-month low as the dollar dipped and oil prices rose after the Federal Reserve signalled an aggressive interest rate hike later this month.
- There are many benefits of investing in gold as it is highly liquid and protects your investment and creates wealth in the long run.
The yellow metal surprisingly saw an uptick from an 11-month low as the dollar dipped and oil prices rose further. This was on the back of the news that the Federal Reserve signalled a second consecutive aggressive interest rate hike of 75 basis points later this month, which has hit the investors' expectations.
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Traditionally, gold is viewed as a safe haven, especially in a volatile environment. The UK inflation rate has touched a record 9.1% and with the prediction of it reaching up to 11% later this year, investors may turn to gold as an inflationary hedge.
During the harsh economic conditions, the currency's value depreciates relative to the yellow metal, thus creating a perception of safety among investors. Recently, the International Monetary Fund (IMF) has warned that it will cut its global economic growth outlook for this year and later this month.
The gold future had risen by 0.53% to US$1,712.50 an ounce at 2:22 AM (GMT+1) after falling to its lowest in nearly a year last week. Meanwhile, GBP to USD currency rates stood at 1.1884, up by 0.29%.
Let us explore the following FTSE gold stocks that you may consider investing in.
Pan African Resources Plc (LON: PAF)
With a market cap of £411.23 million, as of 18 July 2022, the FTSE AIM UK 50 listed mid-tier-focused gold producer's shares were trading at GBX 18.50, around 08:05 AM (GMT+1). Pan African Resources Plc has given its shareholders a positive return of 9.83% over the last 12 months, while its YTD return stands at 9.70%.
Endeavour Mining Plc (LON: EDV)
The shares of a multinational mining company were up by 0.37% at 8:05 AM (GMT+1) on 18 July 2022. EDV shares on Monday were trading at GBX 1,636.00. Endeavour Mining Plc, which owns and operates the gold mines in Cote d'Ivoire, Senegal, and Burkina Faso, has offered its investors a return of -2.50% over the last year of 18 July 2022. EDV's YTD stood at -2.04%.
Centamin Plc (LON: CEY)
With a market cap of £860.63 million, as of 18 July 2022, the shares of CEY were trading at GBX 75.82, up by 1.88%, around 08:10 AM (GMT+1). The FTSE 250 constituent gold mining company had given its investors a negative return of 26.57% over the last 12 months. Its YTD return stood at -14.64%.
Note: The above content constitutes a very preliminary observation or view based on market trends and is of limited scope without any in-depth fundamental valuation or technical analysis. Any interest in stocks or sectors should be thoroughly evaluated taking into consideration the associated risks.