The global market is all hyped about the place of currency trade, but there is one catch; currency is not stable. In Singapore, the country’s economy has been undergoing stunted growth over the last few quarters but one asset that seems not to fall out of value is of course gold. The country’s exports in June 2016 according to MAS were downcast to 2.3% but this rapidly changed to 11.7% amidst a backdrop of increased gold exports.
The country’s gold exports to Malaysia, China and Switzerland among other countries have grown by a phenomenal 436.7% since May 2015. If you are looking for a viable investment in Singapore today, forget the U.S. dollar and join the gold investment bandwagon.
Why Invest in Gold
Despite global market doldrums, there is always one constant; gold. There might be a crash today but you can bet gold will recover and its value is consistent. There is demand across the globe and compared to the U.S dollar investors can expect better ROI. The dollar has plunged 98% over the last 50 years while gold has consistently retained its purchasing value over the years. With the current global uncertainties, investing in gold is the wisest decision because this is the safest investment in such an environment.
Ask yourself why most central banks in the world want to retain gold in their reserves. Their financial experts know this is the ultimate investment. It is a war chest for the worst situation and as the Bank of England says, gold has been used as a reserve for thousands when times are tough. Bullion is the best alternative to currency in Singapore.
How Gold Prices are Determined
There are many factors that will determine the price of gold in Singapore and surprisingly, most of them are external. Price movements of other commodities directly impact process as this will determine the purchasing power of investors. Global inflation especially in the U.S will also affect prices immediately as more people rush to buy bullion. The central bank’s activities such as gold sale and purchases will affect prices and you need to be on the lookout for such activities. Interest rates especially in the U.S will determine the global gold prices while the demand and supply rule still applies for the gold market.
The question then becomes; do you buy now or stay away? The prices are low since reaching a high of USD$1,900 in 2011. It all boils down to what you want to do with the gold. If you want to trade the price, this is not the perfect time but for investors looking for a hedge against market risks locally and globally, it is time to grab bullion at the existing low prices. The idea is to keep buying small bars and coins and keep watching the prices.