With inflation raging around the world, physical gold is a must-have in your portfolio. If you’re still wondering if the king of metals is a good investment in 2022, here’s what you need to know. 

Is Gold a Good Investment for 2022?

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Gold is now back above its key psychological bullish mark of $1,800 which reinforces its role as a hedge against inflation.

 are looming over the future moves of the gold price.

 and could the precious metal create new opportunities for investors in 2022?

Why the gold price didn’t rally in 2021?

With some of the key drivers of the gold price in place, it almost looks like a mystery why gold didn’t rally hard in 2021.

a cartoon picture of a suited man with a suitcase sitting on a pile of gold bars with a golden flag on top

At least three of these main drivers for gold seemed to be present last year: 

over the past year, inflation was all over the news (and probably in the Fed’s biggest nightmares), as it hit a 40-year high in the U.S. and a 13-year high in Europe. 

central banks definitely❤️gold this year. According to the World Gold Council, central bank buying rose by an impressive 82% in 2021, with Thailand coming up as the biggest buyer (it bought as many as 90 tons of gold).

this driver is not usually cited among the main driving forces for the gold price, but it’s in fact very important, especially with today’s economic uncertainty. Last year, central banks printed money at a record pace to prop up their economies hit by the COVID-19 pandemic. As a result, this has considerably weakened the purchasing power of paper money. 

And when paper currencies start losing their purchasing power, investors usually look for alternative stores of value to protect their wealth, turning to assets like physical gold which has maintained its value throughout centuries.

Then, why there was no big rally in the gold price this year?

 for most of 2021, investors seemed to believe the Fed’s long-time favorite “transitory” inflation mantra. Right until Fed chair Jerome Powell finally admitted inflation was a real threat, one too dangerous to be ignored any longer. So, in other words, the gold price didn’t react to higher inflation as much as some might have expected simply because the majority of investors actually believed inflation was going to fade away. 

Index levels for inflation in the Eurozone and the U.S.

They show consumer price inflation in the Eurozone and the U.S. starting from 2019, with a steep spike in prices in 2021.

So instead of being a temporary issue, inflation has become a worldwide phenomenon, and for now, it looks like it is not going to end soon. 

 some analysts say bitcoin and other cryptocurrencies held the attention of many investors, including physical precious metals buyers, distracting them from multiple short-term gold rallies throughout the year.

everything you need to know about crypto volatility

, and gold and bitcoin acting as supplementary investments).

 it’s the same story here: many investors joined the rush of buying high-flying stocks like Apple and Tesla, two of the last year’s best performers. But according to a December report from Goldman Sachs, Apple and Tesla stocks are not expected to do well in 2022. 

And in general, the stock market is off for a choppy year, with 

geopolitical worries, inflation, and interest rates already spurring some wild swings on Wall Street

So will persistent inflation and stock market pullbacks support the gold price in 2022? 

“Elevated inflation and market pullbacks will likely sustain demand for gold as a hedge. Jewelry and central bank gold demand may provide additional longer-term support.”

Well, we can’t say for sure because everything depends on your investment strategy and personal needs and goals.

a cartoon picture of a cashier and an investor buying a fine gold bar and four piles of gold coins

But as a rule of thumb, wealth managers usually recommended 

to keep up to 10% of your investment portfolio in gold

 to protect yourself against possible economic downturns, including stock market crises and the devaluation of most currencies that we see happening today.

Where do top market experts see the gold price in 2022?

Investment management company Blackstone Inc.

as the precious metal will keep its inflation hedge status, according to Byron Wien, vice chairman of 

 private wealth solutions business, and chief investment strategist Joe Zidle.

“The price of gold rallies by 20% to a new record high. 

investors seek the perceived safety and inflation hedge of gold

Gold reclaims its title as a haven for newly minted billionaires

, even as cryptocurrencies continue to gain market share,"

Equity research and funds management company Fat Prophets

A similar positive outlook for gold came from fund management company Fat Prophets, which said gold could reach 

Nicky Shiels, Head of Metals Strategy at MKS PAMP GROUP

the average gold price in 2022 at $1,800, with the highest estimate set at $1,965, 

“could become unstuck as 3 important drivers for Gold - inflation, the Fed, and expected equity volatility - are on the move this year.”

“Gold has one more peak higher as the ‘inflation’ or "Fed policy mistake" peak is not yet in. A short US labor market, future COVID variants and associated zero/low COVID policies create necessary persistent stagflationary forces,”

 Nicky wrote in her 2022 outlook for precious metals. 

In other words, gold could still price in on higher inflation or a policy mistake by the Fed, such as the failure to tame surging prices, for example.

full precious metals outlook 2022 by Nicky Shiels here

Multinational investment bank Goldman Sachs 

And finally, Goldman Sachs gives a final answer to the main question of this article: 

"For investors looking for a way to hedge their portfolios from risks of a growth-slowdown and falling valuations, we believe a long gold position would be more effective in the current macro environment."

It’s now up to you to make your choice, but it’s always better to be prepared than sorry. 🙃

Gold offers several powerful advantages as a store of value. Discover why more and more investors are turning to this precious metal.

What are the advantages of gold compared to other investments?

A look at the strong changes in demand in the gold sector y-o-y.

A Shift in Gold Demand Trends

Good thing central banks can't print gold. 😉

21.9% Annual Inflation... and Counting

Despite slowing down, the frenzy around silver has kept prices up, and demand for physical bars and coins strong, while doubts over the state of the silver stocks emerge. Is Silver Setting the Stage for a Breakout?

Is Silver Setting the Stage for a Breakout?

We are thrilled to announce that our CEO Alessandro Soldati was invited for an open and lively discussion on a popular YouTube channel Frugalisme et Liberte Financiere.

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17/02/22: The European Central Bank could raise interest rates in 2022, the gold price goes up as tensions over Ukraine resurface, Switzerland lifts most Covid-19 restrictions. And more.

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Reddit and the Wall Street Silver crowd are planning a new #Silversqueeze. With more coordination and hindsight, will they succeed in rising the silver price? 

#Silversqueeze 2.0?                         

The Federal Reserve’s inflation goals are getting risky and could cause the rate to overheat dangerously if they were to push it too hard.

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Meet GOLD AVENUE CEO, Alessandro Soldati, in our first Q&A video session!

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The Fed desperately wants higher inflation that would exceed its 2% target. Will the ECB follow the lead? It looks like it. 

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24/02/22: Russia has launched a full-scale invasion of Ukraine, the S&P is in a correction for the first time since the 2020 Wall Street plunge, gold hits a 20-month high. And more. 

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Russia’s decision to remove the US dollar assets from its sovereign wealth fund and partially replace them by gold boosts the yellow metal’s importance as a strategic asset.

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After yet another central bank starts considering negative interest rates, we’re taking a look at how unlimited debt can impact physical gold investment.

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World markets have taken a hit as the Russian invasion of Ukraine spooked investors around the globe. Here’s what you can do right now to protect your investment portfolio and gold savings.

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You probably noticed certain industries and communities aren’t bouncing back as quickly as others during times of recession or economic crisis. That’s what the K-shaped recovery is all about.

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03/03/22: Markets are on a wild rollercoaster ride, Eurozone inflation at a record high, Russia intensifies its invasion of Ukraine, gold proves itself as a safe haven. And more.

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The #silversqueeze movement took the investment world by storm and has the potential of shaking up the silver market. Will it be here for the long term?

#silversqueeze

Here’s a rare sneak peek into one of the world’s biggest gold refineries. 

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10/03/22: Gold and palladium hit a record high, oil records its worst day since November, Biden signs an executive order on crypto. And more. 

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In 2021, central banks continued buying gold, with emerging countries stepping up as key net buyers. Do you wonder why? Here’s what you need to know.

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With inflation soaring in Europe and the U.S, learn how to navigate higher consumer prices from this great personal finance video from Sorelle Amore.

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17/03/22: The Fed has raised interest rates for the 1st time since 2018, one of Brazil’s biggest funds goes for gold, E.U.'s rethinking gas supplies. And more.

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After Russia’s invasion of Ukraine, investors rushed to gold, the world’s oldest safe-haven asset, pushing its price to a new record. Why did this happen? Here’s what you need to know. 

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24/07/22: The U.K. hit by the worst cost-of-living crisis in decades, Powell finally admits inflation is “much too high”, European stocks drop. And more.

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The U.S. Federal Reserve has announced its first interest rate hike since 2018. What could this mean for the gold price? Here’s what you need to know. 

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31/03/22: European inflation soars to new heights, Russia resumes gold purchases, no breakthrough seen in Ukraine war despite renewed peace talks. And more. 

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It seems that the ongoing US presidential election has not changed the situation in the gold market so far as the macro backdrop remains quite favorable to the yellow metal.

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The backdrop of global inflation in the U.S. and Europe was already worrying. Now, Russia’s invasion of Ukraine is making the situation even worse, including sending gas prices soaring to record levels. Here’s what you need to know.

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07/04/22: More and more people are worried about rising consumer prices, experts think the U.S. recession is inevitable, cryptocurrencies are facing some privacy issues. And more.

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It looks like stagflation could be here soon. Here’s what you need to know to understand the economic phenomenon that stifled growth through the 1970s.

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14/4/22: U.S. inflation hit 8.5% in March, the highest since 1981, EU ban on Russian gas could spark a sharp recession in Germany, Ukraine peace talks “at a dead end.” And more.

Weekly Digest: U.S. Inflation at 40-Year High, German Recession Risk 

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21/04/2022: The IMF cuts its global economic growth forecast, UN says the war in Ukraine could create a global food crisis “beyond anything seen since World War II,” Macron and Le Pen fight for the presidency. And more.

Weekly Digest: IMF Cuts Growth Forecast, Hunger Threat

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28/4/22: Russia halts gas supplies to Poland and Bulgaria, the Fed is set for more aggressive rate hikes to tame inflation, Musk seals the deal to buy Twitter. And more.

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04/05/22: The Fed is set to fight inflation with the fastest rate hikes in decades, Fitch trims China’s 2022 growth forecast amid Covid-19 lockdowns, two Argentinian banks will allow crypto trading. And more.

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Swissmint made history as they issued their first-ever 50-franc Vreneli gold coin on May 11, 2022, making a very special coin even more popular in Switzerland and beyond.

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12/05/22: U.S. inflation stays at a 40-year high, defying expectations of a bigger drop, crypto and stocks fall, reacting to the U.S. inflation data. And more.

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19/05/22: U.S. stocks post the biggest daily drop in almost two years, Sri Lanka default hints at troubles ahead for developing nations, E.U. slashes growth forecast. And more.

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25/05/2022: U.S. stocks slumped again amid economic data, the global food crisis risks causing a “messy” migration in Europe, Bitcoin could fall to $8,000. And more.

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02/06/22: The Eurozone inflation hits a new record high, JPMorgan Chase CEO warns of the economic hurricane, EU leaders agree to ban most Russian crude imports. And more. 

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09/06/22: The OECD has lowered its growth forecast for this year, Eurozone inflation is expected to peak, U.K. economy is facing stagnation. And more.

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16/06/22: Fed announced a historic rate hike, a U.S. recession is looming, bitcoin is plunging, U.K. economy is shrinking, China’s contact with aliens. And more. 

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Country-specific guides to understand gold as an investment in 2021 from the World Gold Council.

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23/06/22: The stock market dropped as recession fears grow, UK inflation hits a new 40-year high, Bitcoin could plunge to a low of $13,000. And more.

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While stocks and bitcoin went down sharply due to rising inflation and uncertain economic outlook, gold has retained its value, exactly when investors and savers needed it. 

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29/06/22: Morgan Stanley sees a mild recession coming to the Eurozone this year, G7 countries agree to ban gold imports from Russia, German inflation eases. And more. 

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07/07/2022: Gold drops over 2% in a selloff sparked by a strong dollar, U.K.'s Johnson is expected to step down, higher interest rates are unlikely to solve the inflation problem. And more. 

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14/07/22: U.S. inflation accelerates to 9.1%, Europe is on high alert over Russia’s gas squeeze, NASA reveals the most detailed pictures of deep space ever taken. And more.

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This is the incredible story of one of the biggest gold scandals in history which started in Canada and ended in the depths of the Borneo jungle.

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As the Fed raises interest rates and Russia squeezes gas supplies to Europe, it looks like the global economy is slowly but surely drifting into a recession. Will it happen by the end of 2022, and what does it mean for gold? 

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If you are a beginner investor, choosing the right time to buy physical gold and silver may not look like an easy task. But in reality, it’s quite simple. Especially if you know the right investment strategy.