Gold reserves top in 10 countries – U.S, Germany, Italy, France, Russia, China, Switzerland, Japan, India and Netherlands. Trading at $1,556.80 (at the time of writing this article) there are predictions that by the end of 2020, gold price is likely to reach $5,000 per ounce.
When investors deem precious metal investment as a safe-haven, what are the factors that influence the gold market and how much of risk is involved in it?
Global economic prospects
While U.S. and China are the world’s two leading economies there are many downtrends in other countries due to political, inflation and economic imbalances.
Global Stock Indexes
In fact, global stock indexes are moderately in green all the time and in red most of the time.
However, there are many factors driving such scenario, and investors must stay safe to prevent financial loss.
How does a gold investor think?
While some are long-term investors to wait and watch commodity price surge, others are short term investors. This means, they sell once the price is up by few pips.
Lower interest rates, inflation, rise in U.S.Dollar exchange, trade deals and other geopolitical issues always trigger a drop down in rice. Gold outlook improves when the economy is doing really well.
It is so much important for both short term and long term investor to keep monitoring the Central Bank and market fluctuations to understand the rise and fall in price. The bullish, bearish and neutral survey must also be considered.
However, it is very difficult to predict the market momentum except for watching the market charts.
History of gold
Among commodity market, gold price and investment lead and it is respected across the world for its precious value and long historical recognition.
Having appeared for the first time in 800 B.C., pure gold coins reigned among kings.
With its glittering color and heavy weight, it is so attractive and draws the attention of every investor globally.
According to World Gold Council, India, China and the U.S. are large consumers of precious metal. As demand increases in the manufacturing of medical devices, the supply and demand is affected. As the demand for jewelry and electronics increases, the cost of this commodity rises.
Global manufacturers in China, South Africa, the U.S., Australia, Russia and Peru produced 3,500 tonnes of gold in 2018.
The process of mining is hard labored as miners have to dig deeper to access quality gold reserves. It also causes many other problems such as environmental hazard, rise in costs of gold mine production etc.,
Predictions for 2020
How an investor gets a rally through his/her gold investment in 2020? What’s the forecast?
The highlights of 2019 were: Gold Price Australia
In the first 11-months of 2019, gold reached a high of $1,556.
In 2020, any positive global growth stabilized in Europe and Asia can lead to economic expansion followed by rise in global yields weighing on gold prices.
Gold price is likely to get a hike by 13% with the fact that Central Banks may cut rates.
Trade wars, grim economic outlook and geopolitical tensions also contribute to the hike in gold price..
Fear of recession, Fed reserve rate cuts and trade talks may also leave an impact on gold in 2020.
Finally, gold is likely to continue in macro pattern and may par between $1750-$1800 in 2020. It will be progressive. Gold investors can stay bullish throughout the year and watch the trends and news impact to stay safe.