Author: July 14, 2022

Over the last couple of months a lot of people have been curious about gold. This is because there is so much information out there about buying and selling gold. There are people who are curious about the basics. Some are customers who are curious about finding the perfect time to sell bullion they have held for some time. What is it that most people would like to know?

Will central bank rate hikes affect gold bullion buyers?

Central bank rate hikes should not stop anyone from investing in gold or selling their gold when they think they need to. Rate hikes may be necessary for central banks to get ahead of rate hikes but there are bigger threats that should make investors more nervous.

Gold is more likely to be more attractive to more people now because of the many economic threats that markets are facing right now like inflation.

Inflation is constantly on the rise. So far, according to the Consumer Price Index, it has reached 7.9% in about 40 years. This could be an understatement which doesn’t hold true globally.  According to other Alternate Inflation Indices, the rate is close to reaching double digits.

Gold rallied to $2,000 and in 2021 and then also rallied some more because of the Russian invasion of Ukraine. Now some analysts have gone as far as predicting the gold price will rise to $3,100 an ounce before reaching peak.

What happens to bullion dealers if there are shortages or disruption in the supply of gold?

Recent events have made people uneasy about the availability of certain products. In 2021, we witnessed shortages of gold coins and delivery delays because of the global shutdowns. That seems to have improved and besides, gold dealers have adjusted and changed how they conduct their businesses in order minimize delays.

There might not be any shortages right now but there might be shortages in the pipeline from refiners to mints to wholesalers in the future. However, some mints have experienced problems in the last couple of months which have given rise to fears about supply issues. For instance, in 2022, the U.S Mint announced that it had a silver shortage and it cancelled the production of certain silver products. If one of the world’s most recognized mint has supply problems one can assume that others might also experience supply issues in the future. This is why recycling efforts have been stepped up to ensure that the world does not only rely on mined metals.

There is always a secondary market for bullion coins. Even if mints suspended operations, people will still be able to buy and sell bullion that have previously been in circulation. Precious metal dealers can replenish their inventory from products that has been sold back to them. It might still be possible for demand to be overwhelmingly higher than supply and make the acquisition of bullion difficult.

The bottom line is that, although things might look bleak for the economy, precious metals like silver and gold will continue to be in demand. This means that this still is the best time to buy or sell silver bullion.