One of the most frequent questions that we are asked by our customers is knowing when to buy gold. There is no definitive answer, but let’s look at some indicators as to when gold may be on the rise.
You only have to look at events of the last few years to see how politics affects gold! In the UK, the gold price has steadily increased since June 2016 as the GBP price dropped. The British economy has struggled to right itself since, and this has only worsened in recent years as a result of the lack of stability in parliament with the chopping and changing of ministers.
Gold has traditionally been seen as a safe haven investment. When other assets are struggling, gold comes to the fore, as investors look to move funds into bullion. The lack of trust in banking that grew from the last recession in 2007/2008 encouraged many investors to change tack. Interest rates may be on the rise, but this obviously is in response to the huge inflation figures that central banks are trying to combat. Gold bullion tracks inflation thus bullion became an attractive investment opportunity.
Another contributing factor to the recent gold price rise is the breakdown in relations between the world’s largest economies. The current situation in Ukraine and the underlying tension that any war involving a nuclear power brings has pushed the gold price up, and the ensuing energy crisis only exacerbates the problems faced by world economies.
These three factors are some of the main causes of movement in the gold price. In answer to the question when to buy gold, it’s down to personal circumstance. In truth, all of the above will continue going forward, so when the price is right for you, then that’s the right time to buy gold.
