?||Where are gold prices heading for?||
After over nine years, gold prices hit Rs 50,000 per 10 grams on Wednesday in India the worlds second-largest gold consumer after China as a host of factors like global uncertainties triggered by Covid pandemic, weak dollar, low-interest rates and stimulus programmes have increased the appetite for gold.
Why is the yellow metal continuing its dream run at a time when Covid-19 pandemic has pushed the global economy into a contraction mode? Will it continue the upward momentum?
Gold had a remarkable performance in the first half of 2020, increasing by around 25 per cent from its low in March and significantly outperforming all other major asset classes. Gold futures prices soared to a nine-year high of $ 1,856.60 per troy ounce in London on Wednesday, inching closer to their record high of $1,920 an ounce hit in September of 2011. One troy ounce is equivalent to 31.1034768 grams.
Gold an integral part of wedding ceremonies in India is traditionally used as a hedge against inflation and considered as a safe haven for investors during periods of uncertainties. Whenever stock markets, real estate and bonds fall across the world, investors turn to gold to park their funds. The fall in the value of other asset classes and global uncertainties in the wake of Covid-19 helped gold climb to a record high. A key factor behind this robust performance is that the supply growth of gold has changed little over time increasing by approximately 1.6 per cent per year over the past 20 years. In contrast, fiat money can be printed in unlimited quantities to support monetary policy, as exemplified by the Quantitative Easing (QE) measures in the aftermath of the global financial crisis. Gold, established as an investment, a reserve asset and an adornment, is highly liquid, no ones liability, carries no credit risk and is scarce, historically preserving its value over time.
https://indianexpress.com/article/explained/why-gold-prices-are-going-up-and-will-the-trend-continue-6519592/
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?||Where are gold prices heading for?|| After over nine years, gold prices hit Rs 50,000 per 10 grams on Wednesday in India the worlds second-largest gold consumer after China as a host of factors like global uncertainties triggered by Covid pandemic, weak dollar, low-interest rates and stimulus programmes have increased the appetite for gold. Why is the yellow metal continuing its dream run at a time when Covid-19 pandemic has pushed the global economy into a contraction mode? Will it continue the upward momentum? Gold had a remarkable performance in the first half of 2020, increasing by around 25 per cent from its low in March and significantly outperforming all other major asset classes. Gold futures prices soared to a nine-year high of $ 1,856.60 per troy ounce in London on Wednesday, inching closer to their record high of $1,920 an ounce hit in September of 2011. One troy ounce is equivalent to 31.1034768 grams. Gold an integral part of wedding ceremonies in India is traditionally used as a hedge against inflation and considered as a safe haven for investors during periods of uncertainties. Whenever stock markets, real estate and bonds fall across the world, investors turn to gold to park their funds. The fall in the value of other asset classes and global uncertainties in the wake of Covid-19 helped gold climb to a record high. A key factor behind this robust performance is that the supply growth of gold has changed little over time increasing by approximately 1.6 per cent per year over the past 20 years. In contrast, fiat money can be printed in unlimited quantities to support monetary policy, as exemplified by the Quantitative Easing (QE) measures in the aftermath of the global financial crisis. Gold, established as an investment, a reserve asset and an adornment, is highly liquid, no ones liability, carries no credit risk and is scarce, historically preserving its value over time. https://indianexpress.com/article/explained/why-gold-prices-are-going-up-and-will-the-trend-continue-6519592/