How COVID-19 Has Affected Gold Prices

There are plenty of reasons for uncertainty these days. With COVID-19 affecting nearly every aspect of everyday life for the average person, it’s hard to say for sure when things will change for the better. However, it’s not all bad news; for anyone who’s interested in selling gold, things are definitely looking good.

The stock market is notoriously unpredictable, but one trend that’s stayed constant over the decades is that when things get hard, the value of gold goes up. Given this trend, it’s no surprise that gold prices have been soaring during the current pandemic – the value of gold actually topped $2,000 per ounce this year, something that it’s never done before.

Not only are people paying more for gold, but more of them are doing it. In 2020, gold sales increased by $50 billion worldwide, thanks to the demand for a rock-solid investment. In the United States, American Eagles (the most popular gold coin in the US) experienced a surge in popularity as well, with four times more sales this year than were recorded in 2019.

What makes gold so popular when things get tough?

Gold has a certain image in peoples’ minds: it’s not only valuable, but also immutable. It has the status of a luxury good, and it’s valued as such in every country of the world. There’s only a certain amount of it, so there’s no risk of it ever becoming cheapened by huge quantities flooding the market. It’s tangible and can be stored away, so the owner can feel like they’ve taken responsibility for managing the investment into their own hands.

When things are uncertain, people gravitate towards tangible, solid things like gold instead of intangible investments like bitcoin or oil stocks. Even cash is vulnerable to a sudden loss of value, given the right circumstances. Gold, on the other hand, has inherent value that can even survive extreme events like stock market crashes or governmental collapse.

What has happened to the value of gold during the pandemic?

Exactly what you’d expect – it went up. It hit a record $2,075 per ounce in August as the level of economic shutdown reached a new high, but when a successful vaccine was announced in November, gold prices went back down to around $1,850 per ounce. For anyone who’s thinking about selling their gold, it’s usually possible to follow obvious trends like this; of course there are plenty of fine details in any financial opportunity, but the future of gold isn’t exactly shrouded in mystery.

While gold prices can be easier to predict than other investments, that depends on what the prices are reacting to. In the case of the new vaccine announcement, for instance, there’s no exact historical precedent that experts could base their predictions on. One thing that we’ve been able to observe historically, though, is what happens to the value of gold when interest rates are lowered. This was one of the factors that led to sky-high gold prices this summer: the American government decided to lower interest rates down to unprecedented levels, and as the interest rates dipped, the value of gold rose.

How does this affect me?

If you have gold that you aren’t absolutely set on keeping, now would be the time to find a buyer – and you won’t have any problem finding one in the current market. You might have gold coins or bars, or you might have objects like paperweights, picture frames, or jewelry - things that aren’t of any particular emotional value, but that could have quite a lot of intrinsic value. The item could even be damaged or mis-matched – it’ll still have the same value per ounce as anything else made of gold.

Objects like these could even tide you through a personal economic slump. Due to COVID-related shutdowns, businesses across the nation have been closed for months on end. This has put millions of people out of work, and many of them are looking for alternative sources of income that won’t require them to risk their well-being. Someone in this situation could potentially sell their gold and have enough money to tide them over to the next job opportunity. They won’t even have to leave their house – it can all be done online and through the mail.

Under normal circumstances, it would be possible to sell your gold at a pawnshop…but pawnshops aren’t exactly considered to be essential during a pandemic. You probably wouldn’t be able to get the best price anyway; the best option, whether during a pandemic or not, is to sell your gold to an online buyer.

Don’t worry, this isn’t the “sell your couch on Craigslist” kind of advice. The big online gold-buying companies have thousands of clients every year, as well as a proven track record of competitive prices and fair business practices. When you’re looking for an online buyer, check to see if they have online reviews; these could help you decide which ones look like the best choices. You don’t have to go with just one, either; you can get quotes from several different buyers and pick the one with the highest quote. Online buyers make it easy for their clients – they’ll send you everything you need to ship your items to them, at their cost. Once they’ve received your gold, their certified evaluators will come up with a quote. If you aren’t happy with what they’re willing to pay you, or you just want to shop around a little more, they’ll send the items right back.

Some online buyers even offer a price-match guarantee, meaning that if you got quotes from three different buyers and buyer #2 gave you the highest quote, you could tell buyer #3 about the quote, and they’ll hike their offer to match their competitor’s quote. You don’t need experience in investing to take advantage of the gold market. You can take advantage of the opportunity to whatever degree you want – sell some old jewelry, or cash in on that American Eagle coin you inherited a decade ago. Gold prices will likely go down once the vaccine is introduced and the economy opens back up, so with this particular decision, keep in mind that there’s no time like the present.

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