Now is the Perfect Time to Buy Gold – Here’s Why
Gold is historically viewed as an investment hedge that stays strong even as inflation ravages the economy. Most investors think of it as an insurance policy when bad times roll, as fiat currency and other assets waver in difficult times. The current geopolitical climate has only consolidated the status of gold as a robust safe haven asset.
The value of gold in India has been inching ahead at a very slow pace, but registering on every investor’s radar. On Saturday 29 December, Gold rates climbed by Rs. 20 to Rs. 32,640 per gram for 99.9 percent pure gold. This comes at a time when domestic demand for gold in India has been dwindling, making the last few days of 2018 the perfect opportunity for investors to buy more gold.
Below are just a few reasons why now would be the perfect time to buy gold.
Partial Shutdown of the US Government
The US government’s shutdown turned global economic conditions from bad to worse, wasting away both legislative time and national resources. Neither parties, Democrats or Republicans, have the common sense to realize they don’t hold the monopoly to sway policies in either direction. This means that the shutdown will continue for a few more weeks, possibly for an even longer time.
During the shutdown, the dollar’s value will likely falter, and the equities and stock markets are expected to tank. Investors will scramble around to save their wealth by pegging their hopes against an asset that is virtually immune to the uncertain economy, making gold priority number one, increasing its value. This will inevitably increase domestic demand in India.
To keep track of the bullion, you can visit goldrate.com for up to date information about gold rates and news.
US Federal Reserve Tightens Monetary Policy
While gold prices aren’t necessarily a function of interest rates, the recent price hikes have turned the tide in favor of the bullion. The US Federal Reserve will continue to spike interest rates two more times next year. The past three decades have proven that rising interest rates coincide with rising gold prices, and this will remain so for the next few years.
The Dollar’s Weakening Position
Many fiat currencies that were once dwarfed by the greenback’s shadow are now pushing out from under it. For many investors, it gives them the ability to purchase more gold by using other currencies such as the Mexican peso and Japanese yen, which are rebounding sharply. Emerging fiat currencies will probably strengthen next year, pushing the dollar’s value towards a downward slope.
Traditionally, whenever the dollar falls in relationship with fiat currencies, the price of gold increases.
The 1 Rupee Gold Market Strategy in India
Although domestic demand for gold isn’t rising, this will soon change once the 1 rupee gold market tactic takes its course. The 1 rupee gold market strategy might just solve the problem of high barriers to entry, making it possible for a larger percentage of Indians to purchase gold bullion without having to break the bank.
Online retailers such as SafeGold and Paytm allow users to purchase gold using a simple transaction on their mobile phones, making them eligible for delivery once they have accumulated at least 1 gram’s worth of gold.
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