The price of gold has been steadily climbing over the past few months, and in the last year alone, we’ve witnessed gold rally from $1,720 to $2,300 per ounce. Economists have speculated that gold could reach $2,700 by the end of the year and even soar to $3,000 an ounce. Several factors could propel gold prices higher in the coming years.
Developments in Asian Countries
Economic analysts predict that China is on track to become the world’s largest economy by 2030, surpassing the United States. According to the World Gold Council, 170 million people in Asia will join the middle class each year, with India poised for remarkable success depending on the effectiveness of its government reforms. India’s middle class, which currently stands at 19%, could rise to 73% by 2030.
Asia’s significance lies in its status as the major consumer of gold, with India and China accounting for over half of global demand. Research indicates that demand for gold will double by 2030.
As power shifts from West to East, tensions between governments and competition among the world’s economic powers are likely to intensify. The United States has already initiated trade wars and imposed economic sanctions on China, Russia, and Iran. Brexit remains a significant risk in the UK, with concerns that other countries might follow suit.
During times of heightened economic, political, and social risks, both governments and individuals typically turn to gold as a safe haven. Central banks in numerous countries are buying gold at unprecedented levels. Individual investors, observing the escalating global issues, are also turning to gold. Leading gold buyers Brisbane are experiencing a surge in activity, with gold coming in and going out faster than at any time in the last 15 years. People are lining up both to buy and sell gold.
Technological Advancements
Several ground breaking technologies are poised to impact the demand for gold. The World Gold Council has highlighted key trends:
- The Internet of Things (IoT), enabling household items to be connected to a global network.
- The increasing popularity of electric cars and hybrids.
- The growing demand for solar energy.
These technologies all use gold as a key component, providing a viable reason to believe that they will drive up the demand for gold and, consequently, its price.
Decline in Gold Mine Production
Reports indicate that the number of gold deposits is declining due to rising operating costs. With no new gold mines being established, the World Gold Council predicts a continued decline in gold mining over the next 30 years. This decline could lead to a deficit in gold supply, further driving up its price. Several leading gold-producing countries have already reported a negative trend in their national gold output.
Experts agree that unless current global issues are resolved, gold is likely to perform well in the coming years. According to the WGC’s outlook on gold, the price of this precious metal could reach $1,700 by 2030. However, the spot price already surpassed $1,300 during the second quarter of 2019, and strong indications suggest it could exceed $1,500 by the end of the year.
Conclusion
These are turbulent times, with the cost of living, particularly housing, being high, and many people struggling to make ends meet. Leading Gold buyers are capitalizing on current developments, leading to the proliferation of cash-for-gold businesses. People are turning to these companies to convert their old and unused gold jewelry into cash.
More and more people are recognizing gold as a relevant and profitable investment. Those with gold jewelry are upgrading to coins, and coin owners are upgrading to gold bars. If you have gold jewelry you no longer need, now might be a good time to sell and upgrade your gold holdings.
