After suffering a relatively poor year throughout much of 2015, towards the end of the year the price of gold experienced a surge, going higher than it had been all year. As all gold investors are aware, the price of gold tends to improve when investors sense some danger on the financial horizon, but this doesn’t seem to have been the case this time around.
In fact, the opposite seems to be true as an interest rate hike looks like it could be on the way. This will improve bonds and stocks, which in turn usually lowers the value of gold, but that seems to be far from the truth. In fact, the last four times that the Fed has raised interest rates, the price of gold has increased.
The global bank, HSBC, were the ones to report on this, with their Goal Research Team releasing information which showed that not everything in the gold and financial markets are as they seem. The increase in the value of gold is typically not immediate and happens after a momentary lag, but it is definitely there, and that bodes well with another interest hike on the horizon. Of course, there is no way of telling whether gold will increase or decrease, but with a rate hike due on the 16th December, it is something that all gold investors desperately want to predict.
Speculation is 9 parts research and 1 part luck, and the research in this case is all pointing towards an increase in the price of gold. If we look at the charts published by HSBC covering the last 4 rate hikes, then we can assume that this increase will come in the first half of 2016. In anticipation of this the price of gold may well increase, and that certainly seems to be the case if we take December’s valuation into account. This means that the best time to buy gold is now. Of course, that’s assuming that Lady Luck is shining on gold investors, because there’s always that 1 part element of luck, and as soon as that comes into play then there’s no telling what will happen.