Want to Buy Gold? Its New Price May Shock You

Gold prices are expected to hit a new all-time high of $2600 in 2023, compared to $2075 in 2020 as reported by CNBC. Here is what you need to know about this precious mineral, its current price, and why it is tipped to go high.

Modern Uses of Gold

Aside from the obvious investment reasons and central banks of countries buying up gold to strengthen their country's economy, gold's material terms have also continued, here is how.

Jewelry: For a very long time, gold has been used to make stunning and expensive jewelry. Gold is the best material for crafting elaborate patterns that may survive for countless generations because of its malleability and durability.

Technology: Gold is used in a variety of significant ways. For instance, gold is a crucial component in many modern products, such as cell phones, laptops, and TVs, due to its exceptional electrical conductivity. 

Because it is biocompatible and does not react with the tissues of the body, gold is also utilized in medical devices like pacemakers and other implants.

The History of the Gold Market 

The Gold market dates back thousands of years, as gold has been used as a form of currency, a symbol of wealth, and a store of value for civilizations throughout history.

Gold was first used as currency in ancient Egypt around 2500 BCE, and it has played a significant role in the economies of many cultures and societies since then.

In modern times, the gold market has evolved into a global market where gold is traded as a commodity known in forex as XAU/USD. 

The gold market is divided into two main segments: the physical market and the paper market. 

The physical market includes the buying and selling of gold bars, coins, and jewelry, while the paper market involves the trading of gold futures contracts and exchange-traded funds (ETFs).

World's Gold Producers

The top gold-producing countries in the world as of 2023 are South Africa, Australia, Russia, the United States, and Canada. 

These countries together account for more than half of the world's gold production, with Australia estimated to have the largest gold deposit in the world as of February 2023 with over 8000 metric tons.

Global Market Prices

Gold prices can vary significantly depending on a variety of factors, including supply and demand, economic conditions, geopolitical events, and investor sentiment.

Gold prices are typically quoted in US dollars per troy ounce. In recent years, gold prices have experienced significant fluctuations. 

For example, in the 1970s, gold prices soared due to inflation and geopolitical uncertainty, reaching a peak of $850 per ounce in 1980. 

From the mid-1980s to the late 1990s, gold prices were relatively stable, trading in a range between $250 and $400 per ounce. 

However, since the turn of the century, gold prices have risen sharply again, driven by a variety of factors including global economic uncertainty, low-interest rates, and the devaluation of major currencies.

In August 2020, the price of gold hit an all-time high of $2075 per ounce, by January 2022, the price had fallen again to $1900.

As of March 22, 2023, the price of gold is approximately $1,969.74 per ounce, which is significantly lower than its all-time high but still higher than its historical average. 

The gold market is subject to volatility, and prices are changing rapidly in response to global events and economic conditions.

Why Gold Prices May Go Up

In March 2023, the Silicon Valley Bank (SVB), collapsed, and a lot of investors are now turning their attention to gold.

The demand for gold increased by a warping 18% in 2022, now, between banks collapsing, the continuous decline in the US dollar, and bond yields, the demand for gold is expected to skyrocket this year and the price may hit $2600 before the end of the year.

Why Buy Gold

Hedging against inflation: Gold is often seen as a safe-haven asset that can aid with inflation protection, and with inflation hitting many economies worldwide, gold seems to be a safe investment option.

Gold's price also tends to increase when fiat currency loses value since it keeps its purchasing power over time.

Portfolio diversification: Since gold is a non-correlated asset, its price does not fluctuate in lockstep with those of equities and bonds, or other financial instruments. A diversified investment portfolio with gold in it can assist to lower volatility and risk overall.

Gold is always in high demand worldwide, particularly in nations where there is little faith in currencies guaranteed by the government. 

The price of gold may be supported by this demand, which makes it a desirable investment for individuals seeking long-term growth potential.