The northern hemisphere is experiencing shorter hours as daylight-saving time started, this is historically the best season to buy gold. Historically speaking, the demand for gold goes up towards the end of the year. It is largely driven by the gold buying spree around November when the Hindu festival of Diwali comes around.
Research has shown that there are seasonal patterns to the rise of gold. In 20 to 30 years, the gold price rose by an average 19.2% between January and May. On average, in 30 years the price of gold rose at an average of +7.6%.
Gold has fat as well as lean years. 2021 is shaping up to a one of the lean years with the gold price falling by 6.5% in the last 12 months. There are signs that some economies might have already started recovering and the number of gold buyers is once again on the rise. There recovery plan could have been quicker if the entire globe pushed the same agenda and solution simultaneously. Still, those who can are going on about their business and gold buyers might be making some money, however there are concerns by the greater investment community.
- Central banks began launching their stimulus packages to get their respective country’s economies going, however the debt aspect of this move has other repercussions. When will the Federal Reserve start raising interest rates and by how much? Will the Chinese succeed in scuppering the U.S Dollar as the global reserve currency?
- How sustainable is the rising, massive global debt that has reached upwards of $300 trillion? The U.S governments move to allocate a big budget for infrastructure development has pushed its overall even higher adding to the ever-growing federal debt.
- Inflation, is not as transitory as central bankers continue to argue. With many countries patchily emerging from the recent global recession central bankers are trying to ascertain whether the world economy will recover soon or not. However, some central banks are not employing the “let’s wait and see tactic” but they will insure the gold they receive or send out. No one actually has a crystal ball to see into the future. Will we see an uplift of the price of gold around November or will this year prove to be a leaner year when it comes to the demand for gold globally around the Indian cultural festival of Diwali?
The past seems to suggest that the gold price should be going or at least behaving as it has in the past. This has not been the reality of gold investors. It’s not just gold that is affected but other commodities, stocks, bonds, crypto-currencies and more. So, should people be buying gold as a safe- haven investment when things are still so chaotic?
There is one thing that is true: there is no better time to sell or buy gold, however if you are looking to profit from the gold you already have this would be an ideal time to jump in and sell your gold. Find reputable gold buyers in your area and find one that will give you the best price. Gold is still a good way of saving for uncertain times and things have been really uncertain with fiat currencies being eroded in the last 12 months.