U.S. federal debt concerns put upward pressure on gold

Concerns about what will happen in terms of the U.S. national debt helped to push up the price of gold on September 26.

Those individuals who purchase precious metals might benefit from being aware of this relationship between federal funding concerns and the price of the commodity.

There are worries that the existing negotiations will result in the creation of another government default, according to Reuters. Coping with a deadline of October 1, many lawmakers in the United States are currently making an effort to negotiate successfully so that the federal government does not shut down.

A similar threat existed in 2011, when U.S. lawmakers negotiated a deal at the last minute to avoid defaulting on the national debt. This event coincided with the price of gold rising to more than $1,900 per ounce, which is its highest price to date.

The event was seen by many as the U.S. coming close to a major problem that would have tarnished its reputation and also its financial solvency. Mitsubishi analyst Jonathan Butler told the news source that he does not expect the current debt dilemma to be anything like the one that happened two years ago.

Individuals who purchase precious metals might benefit from closely watching the events related to this latest potential default in government spending.

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