How Did The Great Recession Affect Gold Prices?

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What exactly causes an economic recession? Well, there are many factors that could conspire to cause a drop in commercial activity; interest rates are obviously a major factor. When central banks like the Federal Reserve (privately owned) hike the interest rate, people have less money to spend and that impacts all but essential industries and even them to an extent.

When inflation starts to creep up, this usually sends ripples through investment markets. That typically leads to a surge in demand for gold, as investors take their money out of stocks and shares and move to the safety of gold.

Supply & Demand 

Like most commodities, the price of gold is affected by supply/demand. When you want to know how much the precious metal currently costs, you can always view the spot or live gold price Brisbane dealers display on their website. Using their secure connection, you can buy or sell gold in real time.

The demand for gold is high and this is predicted to continue through to 2023, as the recession takes hold and energy prices keep rising; this causes volatility in major markets. Small investors are usually the first to exit volatile markets for gold.

What Happened During The Great Recession?

The so-called Great Recession started in 2007 and lasted until 2009; during this time, gold performed very well, with a 16.3% rise in a single year. This was a time when investors sought to switch their wealth into gold, as it has always been regarded as a safe investment when the economy is suffering. While less jewellery was made during those years, which would normally see the gold demand drop slightly, the steady rise continued and when things picked up, the demand went down.

Gold Prices Are An Economic Health Indicator

Many financial analysts believe that the price of gold is a good indication of the health of the economy. Indeed, now would be the right time to acquire gold, as some experts predict this recession will be with us until 2026, and climate change might play a significant role in that. It is quite easy to search the Internet for graphs that plot the performance of gold during any recession, which will give you a clear picture on which to base your decision to invest in gold.

Take Physical Possession Of Your Gold

If you are planning to make a significant investment in an amount of gold bullion, we recommend that you arrange an appointment with the bold bullion dealer and take physical possession of the commodity.

Safe Storage

Storing gold requires a high level of security; you can rent a safety deposit box at your local bank, while another idea is to install a concealed safe in your home. It certainly isn’t recommended that you store quantities of gold ingots in a bedroom drawer; that would make a house thief very happy if they found your gold.

If you are unsure about the future of your current investments, it might be time to move into the stability of gold.

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