Why Does The Price Of Gold Fluctuate

by admin on September 28, 2012

Gold prices are once more surging past another record. It has been estimated that the price of gold is now roughly $1,900 an ounce. There are many reasons why the price of this precious metal are constantly soaring and this blog post will explain to you just a few of them.

If you are thinking about investing in gold, but before you make a big commitment with BullionVault or CityIndex you may need to know a little bit more bullion gold investment. Below are a few reasons why the price of gold is always increasing.

Safe investmentĀ 

In the current economic climate, more people are investing in gold because of it is able to retain its value in the long term, as well as being considered a safer investment vehicle for investors during times of economic uncertainty. When the returns on bonds, equities and property fall, investors will flock to investing in gold which drastically raises its price.

Gold MiningĀ 

A lot of gold has already been mined – this is considered the “easy gold”. But now, miners are required to reach further into the ground quality gold and this is what makes its value increase. The gold is much more difficult to mine and the workers involved are open to more dangers to their health. Advanced technology for excavation is also required. Overall, it means that it costs more to get less gold.

DemandĀ 

Just like any commodity on the market, the more it is in demand, the more expensive it will become. The demand for gold ultimately determines its price. If it gets to a point where the demand for gold exceeds its supply then the price will drastically increase. Gold is also becoming an industrial demand as well as a personal demand.

Note: This article is sponsored by BullionVault.

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