Gold has been a prized possession for centuries, dating back to ancient times. It was once used as currency and is now mostly used for jewelry and investments. However, in the past few years, we’ve seen a significant rise in the price of gold. This is good news for those with investments in gold, but have you ever wondered why gold prices are rising? In this blog post, we’ll explore several factors that are responsible for the recent surge in gold prices.
One of the primary reasons behind the rise in gold prices is economic instability. The economy is facing challenges, especially since the outbreak of the COVID-19 pandemic. We’re seeing an increase in unemployment rates, a decline in manufacturing, and businesses going bankrupt. The unpredictability of the stock market is also adding to the economic uncertainties. As a result, investors view gold as a safe haven, and we’re seeing a shift from stocks to gold investments.
Inflation occurs when prices of goods and services increase. Currently, inflation rates are comparatively high, and this is another reason behind the rising gold prices. Gold is seen as a hedge against inflation. Investors are confident that even if inflation continues to increase, gold will always retain its value.
Central Bank Purchases:
Central banks all across the world have been buying up gold to diversify their reserves. This demand for gold from central banks has caused a surge in gold prices. According to reports, central banks have purchased 651 metric tons of gold in 2019, a 47% increase from the previous year.
Geopolitical tensions worldwide have also contributed to the rise in gold prices. With ongoing tensions between the U.S. and China and the U.S. and Iran, investors have become increasingly fearful. As a result, they’re turning towards gold investments, which is driving up the prices.
Finally, another factor that contributes to the rise in gold prices is limited supply. Gold is a finite resource, and the production of gold has decreased in recent years. This creates a scarcity of available gold, which makes it more valuable.
In conclusion, the rise in gold prices can be attributed to several factors such as economic instability, inflation, central bank purchases, geopolitical tensions, and limited supply. The market’s shift from stocks to gold investments has contributed to the current surge in prices. If you’re considering investing in gold, it’s essential to keep these factors in mind. Gold prices tend to fluctuate, and it’s essential to evaluate the market before making any decisions.
What to do with your GOLD
If you have just plain gold jewelry and need some fast cash, then I would recommend selling while prices are high!
If you have old jewelry with diamonds or gemstones that you haven't worn in years or inherited jewelry that you would never wear, I highly recommend talking to our custom jewelry design expert to discover what can be created for you.
It is super exciting and easy to turn that old, unloved jewelry into your new favorite piece!
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