4 Reasons Gold Remains the Top Investment Choice In 2021
The price of gold reached record new highs in 2020 when it peaked at 2,067 USD per ounce during the summer, the highest it has been since 2011. While it fell a little in August, gold prices are expected to rise again in 2021.
During the current uncertain economy, gold proved to be a reliable choice for all kinds of investors, while the US Dollar continued to deflate.
2020 proved why physical gold is one of the best investment options. Here are some more reasons why gold will continue to be a top investment choice in 2021.
The US Dollar Is Weakening
The COVID-19 pandemic brought worldwide economies to a tipping point; the US economy also saw a particularly rough patch.
With the government arranging relief in trillions of dollars, the US Dollar has started to depreciate.
The pandemic’s devastating global economic effects are likely to continue into 2021, and analysts have predicted the dollar to keep weakening. However, a weak Dollar means that gold becomes stronger.
This will encourage gold demand and drive the price of the yellow metal higher.
The economic effects of COVID-19 triggered the US to print trillions of Dollars to protect the economy. Despite these efforts, gold has remained strong, and continued inflation will only increase gold prices.
This makes it a sensible choice for investors and retirees since gold will not be affected by currency fluctuation and prove to be a safeguard against the extra money circulating this year.
Low Interest Rates
The pandemic resulted in an economic slowdown that impacted living costs, employment, and the currency.
As a result, there were no dividends and almost no interest payments on bonds, leading investors away from government bonds, stocks, and other investment forms.
Instead, they turned to gold, which increased the demand and, therefore, gold price.
According to the US Federal Reserve, interest rates may not rise again till 2023, which means investors will not have much confidence in the economy and will depend on gold till then.
Gold has recently started to become more than an investment option, with many industries buying it for jewelry, medical equipment, and electronics.
Earlier in 2020, when the market crashed, investors of all forms bought gold, creating a steady, high demand for it.
While gold remains popular, it has a limited supply, and the halt in gold mining will force prices even higher.
With the world’s economy in a precarious state, it is a great time to invest in precious metals like gold.
Get in touch with Orion Metal Exchange to buy the best gold coins for investment.