Last year represented gold’s “first annual gain since 2012. For the year the average gold price came in at $1,247 an ounce, compared to 2015’s average of $1,160, but nowhere near 2012’s $1,689,” reports Frik Els for Mining.com. “Gold came under huge pressure after the US elections on November 8 as investor money rotated out of gold and into stocks.”
Fueling the gold bet, the global zero or negative interest rate policies have pushed investors toward the hard asset as a better store of wealth, with demand surging to the second-highest level ever in the first quarter, according to the World Gold Council. Moreover, lingering global volatility has also helped support gold as a safe-haven asset.
“Previous cycle lows have been 1.9 ounces in February of 1933 and 1.3 ounces in January of 1980 when gold in inflation-adjusted terms hit an all-time high of roughly $2,400 an ounce. When the nominal price of gold hit a record high above $1,900 in August 2011 the ratio was 6.4. That compares to highs around 40 between mid-1999 when gold reached lows of $250 an ounce and mid-2001,” according to Mining.com.
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