Comparative evolution of the gold price (left scale) and inflation (consumer price index, or CPI, right scale). The sentiment of investors vis-à-vis the yellow metal is more and more positive. The speculative positions have already exceeded their long-term average, although they still remain well below the levels recorded following the vote in favor of Brexit, reports ETF
It believes that limited increases in key rates, coupled with the prospect of rising inflation, driven by labor market pressures and accelerated GDP growth across the Atlantic, should lead to negative real interest rates. A phenomenon likely to stop any decline in the price of gold.
Inflation climbs and purchasing power goes down. Gold should theoretically be one of the few investments to resist, says ETF Securities. Thanks to the yellow metal, which tends to evolve in contrast to equities, investors can effectively diversify a portfolio, with overall volatility smoothed out as shown by the Cheap Forex VPS.
Indeed, over the last ten years, during the ten worst months of the British equity index FTSE100, marked by an average fall of 8.2%, the price of gold was 3.8% in local currency, reports the company.
If the price of an ounce of gold has recovered (+ 28% from the trough of 2015) since the Fed began raising its key rate a little over two years ago, it still remains far of his 2011 historical record (1,912 dollars).
Even if an imminent surge in gold demand is not achieved, a wise long-term investor must anticipate and would do better to turn to the yellow metal, says ETF Securities. It is an investment that can, to a certain extent, protect it in the event of a major downturn in equity markets, while interest rates are raising the head as indicated by the Cheap Forex VPS.
To invest simply in gold, you can buy bullion or bullion, for example from an actor such as CPoR Currencies, even coins, or the Gold Bullion Securities certificate. Those wishing to bet diversified precious metals, be it gold, silver, platinum or palladium, may be interested in the OFI Precious Metals Fund.
Remember also that fundamental analysis is just as important as technical analysis. Also, and in addition to real-time graphics, it is recommended to be connected to a quality economic calendar that will tell you the important economic events of the day.
To find more information about the elements that can influence the price of gold, we advise you to choose your trading platform CFD. Indeed, brokers offering this type of gold contract often provide traders with daily news about this market. You will find real-time explanations of current and future events that may affect the price of the precious yellow metal.