The global gold market has gained more than 6% to 8% in the previous month. The falling value of the united states dollar and anticipation from the US Federal Reserve were this slow the interest rate movement and this increased investor interest in the precious metal market.
The gold value itself has climbed more than $2,000 per ounce in March 2022, Reaching the highest price for the first time since August 2020. The price movement was a response to Russia's aggression against Ukraine in February, This made a significant impact on the geopolitical uncertainty and increased gold’s attractiveness for investors seeking a safe haven option.
Even on the previous market rally, the price itself dropped to a two-year low price in late September, and it's continued struggle to regain the $1,800 price level. But even like that, it's still becoming the safest asset out there as a wealth reserve.
In this short article below, I will make some important key points about why gold it's still a good investment for 2023?
Gold's main use cases
Gold is mostly used as jewellery and investment option. The global gold market demand recorded more than 4,000 tonnes in 2021, This was becoming one the highest demand in the past 10 years, the Market request has jumped by 50% during the fourth quarter of ths year, according to the World Gold Council data.
The request is divided among several option such as Jewellery accounted for 2,220 tonnes, and coins and gold bars with more than 1,180 tonnes.
Centralized entities, such as banks and other financial institutions was bought gold as a reserve option with a demand value of more than 463 tonnes.
It's also affecting Technology global market for example, like parts that are used on electronic devices, the demand itself has accounted for more than 330 tonnes in this year.
But Exchange-Traded Fund or ETFs demand has fallen by only 173 tonnes in 2021 after the highest demand record that skyrocketed more than 874 tonnes in 2020.
Even so, Gold still becoming one of the best safe haven options out there, as well as an investment option especially for long-term run.
Gold Potential
The gold price itself has been analyzed with expectations of multiple interest rate hikes to offset that concern about the economic recovery from the Covid-19 pandemic and inflation.
Basically for most people, Investing in gold will be considered to be an option for a hedge against currency inflation, where it'll retain its value while the fiat buying power erodes. But it also has a drawback where it becomes less attractive when the interest rates rise.
Gold didn't give any interest or dividend payments like stocks or fiat, but the gold market demand increased by more than 6% to 8% in November because of some geopolitical conditions in various regions.
Because of that, in the past month even though the demand was not high as the previous year but it still have the potential for a long-term run since the Global Recession in 2023 has been forecasted by various source.