Right now gold prices are high, but experts predict that the price may continue to rise. There are many factors that can drive up the gold price on the market, and the factors listed below are just a few of these.
1. US Policy- The US policies in place will play a role in the cost that gold has on the market. If the monetary policies of the United States causes investors to become concerned that inflation or deflation is very possible then gold may be invested in to hedge against this financial unknown. If too many investors turn to gold then this will drive up the demand for the metal, which also drives up the market price due to the increased demand.
2. Actions Taken By The US Government- Another factor that is relevant to the gold current price is the US Government actions taken. New Laws and regulations that affect the stock market and other investment areas may cause investors to choose gold instead. This precious metal is fairly simple and is not normally subject to new market rules or numerous regulation changes.
3. Global Economic Considerations- The global economy is a big factor as far as the price of gold is concerned. When the global economy slows down then investors start to become more cautious, and security may take precedence over higher returns when it comes to the available investment capital. Currency devaluation can be a fear that investors around the world share.
4. Disruptions In The Supply Of Gold To The Market- If the amount of gold that is available to the market drops because of a supply disruption then gold prices could shoot up, and this increase could be substantial. Supply disruptions can occur because of many reasons. Labor shortages, strikes, operational problems at one or more mines, natural disasters, and other possible causes could leave gold in short supply and a higher price.
5. An Increase In Global Manufacturing Levels- The gold current price right now reflects the manufacturing base that is present across the globe. As the manufacturing levels increase in each country gold will be in higher demand for these manufacturing activities. This means that less of this metal may be available for investors, and this could mean higher gold prices in the futures. It is doubtful that many countries will scale back manufacturing once this base has been developed, and the rate of gold use in this sector will increase over time instead of going down.