Tally should be pushing this hard..2 Aug 2021 13:58
Worried inflation will melt away your wealth? It could be time to cash in on the falling price of GOLD
'Gold is a form of protection and insurance,' says economic historian John Butler
It is surprising that the precious metal's price has been flat for much of this year
Over the past year, gold has fallen in price by 16% – to below £1,300 per ounce
'Gold bugs' are expecting the price to increase substantially in the near future
By JASMINE BIRTLES, FINANCIAL MAIL ON SUNDAY
PUBLISHED: 21:51, 31 July 2021 | UPDATED: 09:53, 1 August 2021
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If the seemingly inexorable rise of inflation in the UK and elsewhere in the world is making you wonder where you can invest your money and keep up with rising prices, then gold is worth considering – at least for a portion of your cash.
Traditionally, gold has been used as a hedge against inflation, which is why, as prices are already rising at 2.5 per cent, it is surprising that the price of the precious metal has been flat for much of this year after a sharp rise in the summer of 2020.
Indeed, over the past year, gold has fallen in price by 16 per cent – to below £1,300 per ounce.
However, this has not put off 'gold bugs' who are expecting the price to go up substantially in the near future. In fact, The Royal Mint reports that it attracted more than 25,000 new customers in the last year.
It also saw a 430 per cent increase in millennials investing via its new, online DigiGold product, designed to enable people to buy gold easily and without hassle.
'Gold is a form of protection and insurance,' says economic historian John Butler. 'A conservative investor who is interested not only in growing their wealth but also protecting it should always have a proportion of their investments in gold.'
He adds: 'Right now, we have a long laundry list of economic concerns including expansionary monetary and fiscal policies. So while you would always want to have some gold in your portfolio, I would say that the current need for that insurance is unusually large.'
'Gold is a store of value,' agrees Adrian Ash, head of research at metals trader BullionVault. 'It has a strong track record of doing well when the stock market does badly. An overall five-year loss in the stock market usually means that gold will do well. The only time this didn't happen was during the recession of 1992.'
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