By Michelle Graff
Gold spiked on news of Republican presidential candidate Donald Trump’s victory but settled back down after he made a victory speech described as “conciliatory” and “muted.”
New York--The price of gold is expected to trend higher over the next few years, as a president who brings uncertainty to the market prepares to take office and concerns mount over the U.S.’s growing deficit.

The price of gold shot up Tuesday night while the equity markets were falling as the election results rolled in and it became apparent that Republican presidential candidate Donald Trump not only could, but would, upset Hillary Clinton.

“All financial markets dislike uncertainty,” said Mike Mikolay, the senior trader at United Precious Metals Refinery.

He said that market participants in the Far East and Australia who were watching the returns roll in early Wednesday morning their time do not know or understand Trump’s policies, while Clinton is a known entity.

Mikolay said gold shot up $20 in two minutes when it became apparent that Trump would win Florida and, as such, had a better-than-expected chance of winning the presidency.

Prices settled back down around 3 a.m. Wednesday when the unpredictable candidate made a victory speech in which he appealed for unity and offered warm words for the opponent with whom he had so bitterly sparred for months.

Mikolay noted that the speeches made Wednesday by both Clinton and President Barack Obama also had “a bit of a calming influence on the market,” as they too expressed a desire for Americans to come together.

In other words, all the politicians said what was expected of them following a race that was quite unexpected.

Gold, which has been as low as $1,077 and as high as $1,366 in 2016, is expected to finish the year at $1,325 an ounce, both Mikolay and United Precious Metals’ Dave Siminski said.

In 2017, the metal is expected to average $1,400 while their three-year prediction is more bullish at $1,700 an ounce.

In an article called “Jeff Christian on Gold in a Trump World” published by on Wednesday, the author quoted Christian, the managing director at CPM Group, as saying that gold would average around $1,266 an ounce for the rest of the year, rising to an average of $1,325 an ounce in 2017.

Mikolay said increasing concerns about the federal deficit--which currently stands at $19 trillion and is expected to grow under Trump who, like his opponent, has “ambitious” spending plans--will drive the U.S. dollar lower. This will lead to a flight of safe haven buying in precious metals and drive up the gold price.

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