Gold attracted the attention of investors by reaching an all-time high of $2,195. Now, young Chinese investors are investing in gold beans to protect their wealth. Additionally, he uses capital to accumulate other gold jewellery. Meanwhile, central banks continue to purchase gold at full speed.
A “gold rush” event in China!
Interestingly, these beans, weighing one gram each, have become very popular among China’s Generation Z due to their accessibility. So, if we take into account the gold price index of $2,155, their value is about $76. But each gold core costs about 600 yuan, or $84.50, Bloomberg reported. This is mainly due to the production costs of the beans and China’s premium on the commodity in a closed market. Moreover, Gold Telegraph described this investment phenomenon as a “gold rush” in China.
Central banks continue to buy gold
Latest data shows that central banks are actively purchasing bullion for reserves in 2023. cryptokoin.comAs you follow from , geopolitical uncertainty has been a key driver of central bank demand. The yellow metal is the only reserve asset that is completely controlled by its owner. Therefore, it is not surprising that central banks want to increase the share of gold in their reserves. More importantly, despite outflows in gold ETFs, the precious metal managed to stay above the $2,000 level. Thus, it highlighted the strength of core demand for bullion assets.
Most likely, increasing demand for gold from central banks will be a multi-year trend. Because geopolitical tensions are increasing every year. Therefore, central banks have no choice but to diversify their assets and increase the share of gold in their portfolios. In the near term, the AI craze and strong crypto markets could serve as negative catalysts for gold markets as investors rush into riskier assets. In the second half of the year, investment demand for gold will likely increase as the Fed begins to lower interest rates. According to experts, this will push gold to new peaks.
Does it make sense to invest in gold anymore?
After reaching an all-time high recently, investors are wondering whether it still makes sense to invest in gold. It is not possible to predict the future price movements of gold. However, it has historically performed well under the macroeconomic uncertainties the world is currently experiencing. Gold, in particular, has become one of the most solid and popular investments in human history. Additionally, commodities stand out as the leading asset in terms of capitalization, with a market value exceeding $14 trillion.
In this context, these young Chinese investors hoarding gold seem to believe that this is a safe play in the long run. It is also notable that the trend in China is towards actually holding gold rather than betting on the price performance of the commodity through ETFs or other financial instruments.
Finally, gold’s daily price chart shows strong momentum for the popular investment commodity. According to analysts, it is important for investors worldwide to now watch for potential price support at $2,075. Additionally, it would be beneficial for them to act cautiously.
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