The price of gold has reached its highest level in three and a half months, hitting $1,174 per ounce. The cause is the decision of the U.S. FED to postpone raising interest rates and demand in China as a means of protecting savings; the FED opted for such a measure due to weaker U.S. exports amid increased imports from Asia and an anemic global economy.
Gold and other precious metals, as investments, have been particularly attractive in recent years precisely because of low interest rates on other investment classes.
As the U.S. trade deficit reached its highest level in the last 5 years, and the IMF decided to cut its forecasts for global economic growth due to low commodity prices and a slowdown in the Chinese economy, the FED did not dare to raise interest rates, not even by a symbolic 0.25%, and now an increase in interest rates is expected only next year, unless there is a slowdown in economic growth.
Thus, the value of the dollar has decreased, making precious metals a more attractive investment, especially from foreign currencies, as gold prices are formed from the U.S. dollar. Other common precious investment metals (silver, palladium, platinum) also traded at prices close to their highest in recent months.
In Croatia, trading and investing in precious investment metals is still in its infancy; often only in the form of sales for debt settlement. However, there is an offer, in the form of investing in gold bars; some companies provide internationally recognized certificates for quality. Gold, and to a lesser extent other metals, is usually approached in times of uncertainty: but it is precisely in safe times, when the price is still low, with the promise of growth, that investments yield the highest returns.
