The additional credit downgrades for Portugal and Spain have pushed the precious metal to gain even more ground. The yellow metal is considered to be a hedge against inflation – the price of gold rises as inflation rises. The inflation back in 1970s managed to push gold to an exciting high of 850 dollars an ounce. The glittering metal has created so much excitement that people are now trying to figure out how to come up with money to invest in it.
Numerous Central Banks have also started to buy gold following the example of India who has bought last year 200 tons of the International Monetary Fund’s glittering metal. China is another example where gold is bought massively. The Chinese Government has advised the citizens to follow its example and start investing the yellow metal. While specialists were expecting China to buy the rest of the International Monetary Fund’s gold, the country did nothing. The reality is that China was in fact buying its own gold using its own currency. It is known that the country has set its goal in owning more gold than America.
India, the world’s largest gold consumer, has also begun to seriously invest in the glittering metal. The Indian Central Bank representatives declared that they are searching to diversify their assets and this is the only reason why they are buying gold.
If the Central Banks have started to invest in the yellow metal, than we should do the same. If you cannot afford to buy gold bars or coins then you should take into consideration investing in gold by the gram. It is not expensive and it is a good way to protect your savings.
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