We talked a lot about the role of gold in the world’s history because this metal has long been considered the main measure of wealth. Today, gold is still not losing its market share, and the global gold market is functioning and will continue to function in the future. What is the global gold market? Let’s take a look at it and find out more about how this economic mechanism works.
In fact, this term is used today for two definitions at the same time:
1. Globally, the global gold market means all processes related to the corresponding precious metal, starting from its extraction and production up to sale, accumulation, distribution and exchange.
2. In a more narrow sense, the global gold market is a mechanism that regulates the circulation of already mined metal in its various types on the market, that is, sales volumes, gold prices, and the activity of “gold exchanges”.
Both definitions do not contradict each other, they rather complement each other. In general, more than 50 gold markets operate in the world today. Geographically they are located in different parts of the planet.
Despite the fact that gold has stopped functioning as a monetary value, and today currencies are no longer secured by gold, this precious metal remains to be in demand in many areas:
Here are the main holders of the gold reserve:
– USA (over 8000 tons of gold);
– Germany (over 3000 tons of gold);
– Italy and France (two countries have gold reserve over 2000 tons);
– China (1800 tons);
– Russian Federation (1500 tons).
But the global gold market does not begin here. The first and main counterparties are considered to be companies that extract this precious metal. They supply a certain amount of gold to the market, and at the same time the volume of gold mining in recent years has remained approximately at the same level. The main players in the area of gold mining today are Africa, Latin America, China, Indonesia, Russia and Canada.
As for the countries that consume gold, they can be divided into two groups:
– Countries that buy gold for technical purposes, for example, Japan, Germany, USA.
– Countries that buy this precious metal for the jewelry industry (Italy, China, United Arab Emirates).
In most cases, private investors consider gold as a profitable investment, since the price of this metal has been steadily growing since 2016. In order to invest in gold, you can choose one of two options: buying ready-made jewelry or gold bars which is a more considerable investment.
The gold market is constantly changing: prices can rise and fall, albeit insignificantly, and many successful investors get quite large profits on the difference in price. It is not so easy to play on gold exchanges, but constant control and monitoring, coupled with skills, will help you realize this investment project in the best possible way. If you are just going to invest in gold, the best option would be to buy ready-made bars directly from the manufacturer such as the company Golden Way.