Inflation is over the roof! Everywhere you look the prices are rising, be it any commodity or means like oil, transport, real estate, food, etc. The cost of living has gone up massively in a very short period of time. But what led to this chaotic situation?
Ever since the pandemic, the world economy has been plummeting. Everywhere you look, there are layoffs due to the recession. And to add to this, the situation with Russia and Ukraine is of no help too. But one asset stands tall amidst all this!
Why does gold take the centre stage?
It is when dire situations hit, one asset tends to grow and gain added popularity. Yes, Gold. The yellow metal is what one wants to possess amidst these chaotic situations. Why? Simply because it adds a sense of safety and security, unlike any other investments.
And as demand increases, the price grows with it too. As per the Finance Minister of India during the budget 2023, the value of gold is set to grow rapidly.
Let me break down why 2023 is an important year for gold:
Gold is sought after by central banks across the world. Not just that, the investors looking to catch hold of the yellow metal over equities, bonds, and currencies. Why? Simply because of the unstable times.
Firstly, the rise in the cost of living and inflated prices also means the interest rates are on the higher end of the side. Secondly, the situation between Russia-Ukraine invoked fears in the minds of investors. And finally, the collapse of the Silicon Valley Banks along with the sale of Credit Suisse to rivals UBS.
Is this a good time to invest in gold?
On January 1st, 2023, the cost of gold was at ₹56,830, and fast forward to April 23rd, it is at ₹62,370. And if we go further back, the domestic market for gold has given an average return of 13.0% in the last five years. So, one factor is sure. Gold is set to grow irrespective of any situation, it’s just these external factors that speed up the growth.
Analysts do believe gold will continue to perform but the chances of outperforming other asset classes aren’t as high. Alongside this, there are other ways in which Gold investments can be made that will reap the benefits for you.
One good gold investment scheme is to invest in Digital Gold. This asset class is hassle-free as you can invest in gold online. It comes with no making charge, and no storage costs and the price is fixed all across the country. In addition, the asset can be cashed-in in less than no time.
On the other hand, you can consider Gold ETFs (Exchange Traded Funds) which are similar to mutual funds that are traded on the stock exchange.
In conclusion, 2023 is a very important year for Gold! However, inflated costs may make you skeptical about investing at this point in time. But the wave around gold price fluctuation will calm soon enough. So, anytime soon will be a good time to invest in gold.
