Will Gold Go Up or Down in the Upcoming Year?
Inflation, rising interest rates, political unrest, record-high gas prices, international conflicts, and an unpredictable job market have added to a challenging year for everyone. Stocks are on a major roller coaster ride and what to hold or buy is a challenging endeavor. Gold Safe Exchange understands that gold is a safer option for wealth preservation. In March 2022, the price of this precious metal soared above $2,000, the highest price since 2020. Since gold prices reflect the strength of the dollar as a key driver, economic uncertainty and interest rates will affect all assets, gold included. History shows that the price of gold usually rises during economic uncertainty, especially when inflation is high. Will the price of gold go up or down in 2023? All indicators at Gold Safe Exchange point in the up direction. This is good news and an excellent time for buying gold.
Gold Holds Value in Unpredictable Economies
Some consider gold as an emotional asset, and people have certain feelings about what is happening in the stock market. That said, gold is considered less risky than other stocks and appealing for diverse portfolios. Gold is a safe haven asset and a more stable place during a troubled economy where inflation rises more every day. It is a resilient choice as well and is expected by many experts to continue to rise in value in 2023 and beyond. It is well known that gold and silver have significantly outperformed the Dow Jones Industrial Average for many years. Some experts estimate it will go up to $2,500 and higher in the upcoming months and years! According to Jim Cramer, host of CNBC’s Mad Money, “I believe in gold.” He explained that it is one of three things that will hold its value in a recession, including “incredible mansions and masterwork paintings.” When stock prices fall, gold tends to rise. Cramer suggests those working towards asset protection should add gold for insurance against inflation.
More Factors that Affect Gold Prices: Central Bank And Jewelry Market
Two other key drivers that affect gold prices are central bank buying and jewelry purchases. Central banks play a crucial role in ensuring economic and financial stability. Gold is a commodity that is traded all over the world. Internationally, countries like Turkey, China, and India, among others, made higher than usual purchases. This trend is expected to continue keeping the demand for gold high and increasing the prices. Jewelry, which accounts for nearly half of the overall demand for gold, increased by 10 percent when compared to last year. It’s interesting to note that the amount of gold used in one piece of jewelry changes with the market. When gold costs less, more gold is used to create jewelry, and when gold costs higher, less is used in the same item. Currently, even though inflation is high and consumers are watching their budgets and not purchasing luxury items like jewelry, the third quarter of 2022 still shows higher demand for gold, bumping up the price.
Many factors weigh on whether gold will go higher or lower in 2023. The leading trends indicate that it will go higher in 2023, especially due to inflation and recession expectations. Gold Safe Exchange is America’s gold and silver coin exchange, and we are ready to share our expertise and knowledge with you. Contact us today to learn how you can make the switch to gold and silver.