Enquire Now

Please provide your details to reserve space at Guardian Vaults.

Do you agree to receive promotional emails from us?
Would you like to receive our guide to Gold and Silver Bullion?

Enquire Now

Please provide your details to reserve space at Guardian Vaults.

Do you agree to receive promotional emails from us?
Would you like to receive our guide to Gold and Silver Bullion?

Enquire Now

Please provide your details to reserve space at Guardian Vaults.

Do you agree to receive promotional emails from us?
Would you like to receive our guide to Gold and Silver Bullion?

Enquire Now

Please provide your details to reserve space at Guardian Vaults.

Do you agree to receive promotional emails from us?
Would you like to receive our guide to Gold and Silver Bullion?

Enquire Now

Please provide your details to reserve space at Guardian Vaults.

Do you agree to receive promotional emails from us?
Would you like to receive our guide to Gold and Silver Bullion?

Enquire Now

Gold’s performance stabilised this year, following the commodity’s 30 per cent value slump in 2013. However, the precious metal remains sluggish, with current prices slipping under the US$1,200 mark in November.

However, there are still plenty of reasons to be optimistic regarding gold’s prospects in the months ahead, as a number of seasonal, economic and political trends appear on the horizon that could support price rises.

Here are five reasons why investing in gold in the current climate could turn out to be a lucrative choice:

1. Swiss referendum

The upcoming Swiss referendum on gold, which takes place on November 30, has highlighted the importance that many citizens place on having adequate gold bullion reserves to underpin monetary policy.

If the vote passes, Switzerland must hold at least 20 per cent of its balance sheet in gold and will need to repatriate its bullion bars stored in Canada and the UK.

2. Japanese recession

Earlier this month, Japan officially fell into recession, with the country experiencing two consecutive quarters of negative growth. The nation’s economic performance has now performed poorly for over 20 years.

Japan’s interest rates have been below 1 per cent since 1994, and many analysts point to this as a clear indicator of why near-zero interest rate policies don’t work.

Many other countries have similar monetary initiatives in place, which could spell good news for gold should these nations follow Japan’s lead and fail to recover.

3. Seasonal strength

The end of the year marks two significant events in the gold investment calendar – the Indian wedding and festival seasons and the Chinese Golden Week. Both are extremely popular times to purchase the precious metal.

Chinese New Year celebrations, which will be on February 19 next year, are also likely to have a positive impact on gold markets over the coming months.

4. US Fed stops quantitative easing

While the US Federal Reserve’s decision to taper its quantitative easing initiative has weighed on the price of gold recently, the commodity could experience a significant rise in value if the country’s economy falters.

The Fed shut down its bond-buying program last month, following several $10 billion a month reductions over the year. At its height, the organisation was pumping $85 billion a month into the economy.

Since the move, US economic data has been mixed, with poor manufacturing figures and an underwhelming labour market performance suggesting the nation is not safe yet. Any downturn in the US is likely to have a positive effect on gold prices.

5. Dwindling supplies

As prices dropped throughout 2013, it became unprofitable for many mining companies to produce gold. This caused a number of firms to shut down loss-making operations.

If this trend continues – particularly as central banks worldwide seem to be ramping up consumption – there could be a significant gold shortage on the horizon.

As is the case with most commodities, once demand starts to outstrip supply, the value of gold will climb to plug the gap.

 

5 Reasons to be Optimistic About Gold

Gold’s performance stabilised this year, following the commodity’s 30 per cent value slump in 2013. However, the precious metal remains sluggish, with current prices slipping under the US$1,200 mark in November.

However, there are still plenty of reasons to be optimistic regarding gold’s prospects in the months ahead, as a number of seasonal, economic and political trends appear on the horizon that could support price rises.

Here are five reasons why investing in gold in the current climate could turn out to be a lucrative choice:

1. Swiss referendum

The upcoming Swiss referendum on gold, which takes place on November 30, has highlighted the importance that many citizens place on having adequate gold bullion reserves to underpin monetary policy.

If the vote passes, Switzerland must hold at least 20 per cent of its balance sheet in gold and will need to repatriate its bullion bars stored in Canada and the UK.

2. Japanese recession

Earlier this month, Japan officially fell into recession, with the country experiencing two consecutive quarters of negative growth. The nation’s economic performance has now performed poorly for over 20 years.

Japan’s interest rates have been below 1 per cent since 1994, and many analysts point to this as a clear indicator of why near-zero interest rate policies don’t work.

Many other countries have similar monetary initiatives in place, which could spell good news for gold should these nations follow Japan’s lead and fail to recover.

3. Seasonal strength

The end of the year marks two significant events in the gold investment calendar – the Indian wedding and festival seasons and the Chinese Golden Week. Both are extremely popular times to purchase the precious metal.

Chinese New Year celebrations, which will be on February 19 next year, are also likely to have a positive impact on gold markets over the coming months.

4. US Fed stops quantitative easing

While the US Federal Reserve’s decision to taper its quantitative easing initiative has weighed on the price of gold recently, the commodity could experience a significant rise in value if the country’s economy falters.

The Fed shut down its bond-buying program last month, following several $10 billion a month reductions over the year. At its height, the organisation was pumping $85 billion a month into the economy.

Since the move, US economic data has been mixed, with poor manufacturing figures and an underwhelming labour market performance suggesting the nation is not safe yet. Any downturn in the US is likely to have a positive effect on gold prices.

5. Dwindling supplies

As prices dropped throughout 2013, it became unprofitable for many mining companies to produce gold. This caused a number of firms to shut down loss-making operations.

If this trend continues – particularly as central banks worldwide seem to be ramping up consumption – there could be a significant gold shortage on the horizon.

As is the case with most commodities, once demand starts to outstrip supply, the value of gold will climb to plug the gap.

 

Disclaimers: Guardian Vaults Holdings Pty Ltd, Registered Office, Scottish House, 100 William Street, Melbourne, Victoria, 3000. ACN 138618176 (“Guardian Vaults”) All rights reserved. Any reproduction, copying, or redistribution, in whole or in part, is prohibited without written permission from the publisher and/or the author. Information contained herein is believed to be reliable, but its accuracy cannot be guaranteed. It is not designed to meet your personal situation. Guardian Vaults, its officers, agents, representatives and employees do not hold an Australian Financial Services License (AFSL), are not an authorised representative of an AFSL and otherwise are not qualified to provide you with advice of any kind in relation to financial products. If you require advice about a financial product, you should contact a properly licensed or authorised financial advisor. The information is indicative and general in nature only and is prepared for information purposes only and does not purport to contain all matters relevant to any particular investment. Subject to any terms implied by law and which cannot be excluded, Guardian Vaults, shall not be liable for any errors, omissions, defects or misrepresentations (including by reasons of negligence, negligent misstatement or otherwise) or for any loss or damage (direct or indirect) suffered by persons who use or rely on such information. The opinions expressed herein are those of the publisher and/or the author and may not be representative of the opinions of Guardian Vaults, its officers, agents, representatives and employees. Such information does not take into account the particular circumstances, investment objectives and needs for investment of any person, or purport to be comprehensive or constitute investment or financial product advice and should not be relied upon as such. Past performance is not indicative of future results. Due to various factors, including changing market conditions and/or laws the content may no longer be reflective of current opinions or positions. You should seek professional advice before you decide to invest or consider any action based on the information provided. If you do not agree with any of the above disclaimers, you should immediately cease viewing or making use of any of the information provided.