Who has been investing in gold for a long time? Lucky you. The price of gold is currently around Rp. 900 thousand per gram.
Even previously had penetrated the price of a million in the middle of last year. This price is the most expensive in history.
Yes, gold prices do go up and down every day. It can go up by Rp. 10 thousand today, then the next day it goes down to Rp. 5 thousand, or vice versa.
Thus, if you want to buy or sell gold, you must pay attention to the right time so you don’t lose. The rise and fall of gold prices is not without reason.
Here are some factors that cause gold prices to rise and fall:
Also Read: Top Gold Investments During Critical Situations, Here’s The Proof!
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Gold Investment
Gold prices go up and down influenced by many factors
1. Uncertain global conditions
Various events that occur in a country, such as changes in government policies, politics, economy, natural disasters, and social problems can affect the price of gold.
Including the coronavirus outbreak. The COVID-19 pandemic has had a major impact on the world economy. Many people choose to invest in safe instruments, such as gold, because gold is known as a safe haven investment.
That’s why the price of gold has increased. As it is today, the price of gold is expensive. But once conditions and situations stabilize, the price of gold will fall because the demand for it decreases.
2. Exchange rates that go up and down
The rise and fall of gold prices also cannot be separated from the influence of exchange rates or currency exchange rates. In this case using US dollars. When the US dollar exchange rate strengthens against the rupiah, the price of gold also increases. Conversely, if the US dollar weakens, the price of gold is dragged down.
That is, if the rupiah exchange rate weakens, the price of gold will rise. You can take advantage of this momentum to sell gold. But if the rupiah exchange rate is strong, the price of gold will be cheaper and it’s time to buy gold.
Also Read: Gold Investment: Here’s How To Safely Sell Antam’s Precious Metals via Online Queue
3. Depends on the demand and supply of gold
Remember the law of Ceteris Paribus? This law states that the higher the demand than the supply, the higher the price. If demand falls, prices will fall.
When many people, including women, buy gold, but only a few traders sell gold at that time, the price will definitely increase. On the other hand, if the demand for gold decreases, while those who sell a lot, the price will decline.
Gold
One of the causes of the ups and downs of gold prices is because of supply and demand
4. Changes in interest rates
The rise and fall of gold prices also cannot be separated from the influence of monetary policy issued by the United States Central Bank or the Fed. For example, an increase or decrease in the benchmark interest rate.
If the Fed raises its benchmark interest rate, gold prices will usually fall. This happens because investors prefer to put their money in dollar instruments, as well as debt securities with higher yields.
But if the Fed lowers its benchmark interest rate, people will run to investing in gold because it is considered more attractive and safer. So the price of gold tends to be more expensive.
The Fed’s decision to raise or lower the benchmark interest rate is influenced by several factors, such as inflation, unemployment, economic growth, and others.
Also read: Gold Investment in Tokopedia and Bukalapak, which is cheaper?
5. Inflation rate
Inflation in a country will affect the price of gold. If the inflation rate in Indonesia is high, for example, gold prices tend to be more expensive.
Why is that? Because rather than investing in instruments whose profits are eroded by inflation, it is better to invest in gold that is safe and has a stable value.
No wonder if inflation is high, conglomerates or wealthy people diversify or switch to gold investments to secure their wealth.
Long-term Gold Investment is More Profitable
In investing, you must also have an investment goal. Collect gold for what? Is it for the cost of getting married, buying a house, paying for children’s education, preparing for retirement, or others.
Then, determine the need for funds and the investment period. Calculate by making a simulation based on the price of gold per gram.
That way, you can know how much money you have to spend every month for gold investment. But still adjusted to your financial capabilities.
