What is driving the Price of Gold jewelry ?

Want to buy Gold jewelry? Today, gold is sought after not only for investment purposes and a strong jewelry market, but it is likewise employed in the fabrication of certain electronic and medical devices. Gold (as of March, 2011) was about $1,343.60 per ounce and making record highs.

What factors drive the price of this precious metal?

Central Bank Reserves

Central banks hold paper currencies and gold in reserve. The World Gold Council has stated that central banks have recently started buying more gold than they are selling, the first time this has occurred in decades and influencing price of silver per ounce. As the central banks diversify their monetary reserves:

–           Replacing paper currencies by accumulating gold instead

–           the monetary value of gold goes up

What is driving the Price of Gold jewelry ?

The value of the U.S. dollar

The cost of gold is generally inversely related to the value of the United States dollar: a stronger U.S. dollar tends to maintain the cost of gold lower and more controlled; a weaker U.S. dollar is likely to push the cost of gold higher. This is because people possess a tendency to invest and trade in dollars when the dollar is strong. During times of economic doubt and when the dollar is weak, nonetheless, people opt to invest in gold, through vehicles and Buy Gold jewelry.

Global Jewelry and Industrial Demand

In 2015, jewelry accounted for more or less 54% percent of gold demand, which totaled 3,812 metric tons, according to the World Gold Council and The London Bullion Market Association. India, China and the United States are the biggest consumers of gold for jewelry in terms of intensity.

Gold and silver pricescan be struck by the basic theory of supply and demand: as demand for consumer commodities such as jewelry and electronics increase, the price of gold can go up.

Wealth Protection

During times of economic uncertainty, as witnessed during the recessional of the late 2000s, more people turn to investing in gold because of its prevailing value. Amber is frequently reckoned a “safe harbor” for investors during uncertain times. When the anticipated or actual returns on bonds, equities and real estate fall, the interest in gold investing increases, pushing up its price.

Gold can be used as a hedge against currency devaluation, inflation or deflation.

Gold Production

Major players in global gold mining include China, South Africa, the United States, Australia, the Russian Federation and Peru. The world’s gold production affects the cost of gold, another model of supply and demand. If you need to know more you can click on this link:http://www.kitco.com/commentaries/2015-07-24/Does-Jewelry-or-Central-Bank-Demand-Drive-the-Gold-Price.html here. Gold mine production increased by almost three percent in 2010 to approximately 2,652 metric tons, according to GFMS as several new large-scale mines began operations. Despite this modest gain, however, gold mine production has been in a decline since the early 2000s.

One element is that all the “soft gold” has already been mined; miners now have to dig deeper to access quality gold reserves.  Gold is more challenging to access raises additional problems: the miners are exposed to additional hazards, and the environmental impact is enhanced. In short, it costs more to produce less gold. It adds to the costs of gold mining and production, thus rising gold and silver prices.

The main factors that influence gold prices are demand for gold, central banks gold reserves, the current value of US dollars and the desire to hold gold as a hedge against rising prices and currency devaluation; all help drive the Jewelry prices, as gold is one of the world’s precious metals.

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