Gold and Currencies

Outlook for gold and silver

Quantitative easing and other ‘money printing’ type machinations by central banks, have led to increased concern over the value of money.

This has led to increasing interest in gold, silver and other precious metals as a store of value.

At the same time, low interest rates – ‘cheap money’ – continue to push stock and asset prices to dizzying levels. Some investors are nervous of a coming crash. Bigger than we’ve ever seen before.

Gold can provide a safe haven. Although it’s not readily usable as a means of exchange. Which is why we’re also seeing new rises in cryptocurrencies as a possible alternative hedge.

Currency wars

Globalization has hurt many industries in the developed world. And populist leaders are fighting back with tariffs and other measures.

Some say big export countries like China have been manipulating their currency for years.

Either way, when you’re investing globally, the pair between your home currency and the offshore one becomes vital.

A currency pair is expressed like this: GBP.USD.
In that case, you can either sell GBP for USD, or buy GBP with USD at the going rate.

After the Brexit vote in the UK, GBP softened against many of the other major currencies. Then it rose again with news on a deal. Falling when that became less clear.

In volatility there is opportunity. There is also risk. So foreign exchange can also drive return.

But for those looking to avoid volatility, it often comes back to gold. And its these dynamics between precious metals, currencies and now – cryptocurrencies that we’ll be keeping you abreast of.