What the ongoing geopolitical tensions between Russia and Ukraine, and China and Taiwan could mean for markets? How could they affect the gold price? Here’s what you need to know.

What Geopolitical Tensions Could Mean for Gold?

GA News

The Spotlight

Newsdesk

Studies & research

 investors have been jittery about some of the 

, fearing they could spiral up and hit the markets already hurt by Covid and 

More than 700 market professionals, questioned as part of Bloomberg’s 

geopolitical instability among the biggest risks

Here are the outcomes of the survey summarized in the graph:

a graph showing the biggest tail risks for markets in 2022, according to market professionals

Two current geopolitical issues have made

 market professionals particularly worried

The biggest worry is that any escalation, in either case, could lead to an invasion and 

Let’s see what each of these two “geopolitical hotspots” could mean for the global economy and how it could affect the 

China-Taiwan tensions may hit global markets

Pressure between China and Taiwan has been building over decades, with 

reunification lying at the heart of this issue

Chinese and Taiwanese flags folded together amid simmering tensions over reunification

Beijing sees self-ruled Taiwan as a breakaway province that should be part of China again. But Taiwan sees itself as an independent country, with its constitution and elected leaders.

to ramp up diplomatic and military pressure

 on Taiwan, notably by sending military planes into its Air Defense Zone, an area to monitor and control foreign aircraft incursions.

The number of planes reported peaked in October 2021, with over 50 incursions in a single day.

persistent problems with global supply chains

 that experts say could last deep into 2023.

The thing is, much of the world’s everyday electronic equipment - from phones to laptops and watches - is 

powered by computer chips produced in Taiwan

As we can see from the chart below, a single Taiwanese company, the Taiwan Semiconductor Manufacturing Company or TSMC, has over half of the world's market.

Global foundry share by country and company in 2021

TSMC is a so-called "foundry" - a company that makes chips for big tech clients like Apple, Intel, Qualcomm, AMD, Nvidia, etc. 

And although TSMC said it will spend as much as $44 billion to increase its manufacturing capacity in 2022, a potential conflict with China could hurt one of the world's most important chip-producing industries and end up severely impacting some of the world’s largest economies. 

One of the consequences is that the persisting semiconductor shortage can further fuel already high inflation, which in turn is likely to push the price of gold higher as it has done in the past.

Russia-Ukraine crisis risks having a devastating effect on the global economy

 began as an internal Ukrainian crisis in 2013 that spiraled into mass protests and the annexation of Crimea by Russia in 2014.

Russian and Ukrainian flags with a big black crack in between as a sign of deteriorating bilateral ties between the two countries

The low-level fighting between the Ukrainian military and Russian-backed separatist rebels started in April 2014 and has since escalated into what many see as an 

Tensions between Russia and Ukraine and Russia and the West are now at their highest in years: a recent Russian forces' build-up near the Ukrainian border sparked fears that Moscow 

 into the neighboring country. NATO chief Jens Stoltenberg has even warned of 

“a real risk for a new armed conflict in Europe.”

The latest media reports suggest the situation could escalate. The White House said citing U.S. intelligence officials that Russia had already deployed operatives to eastern Ukraine to 

However, Moscow has strongly denied all the allegations, dismissing them as 

 and instead asked for some guarantees for its own security, including a 

 to the East. But recent talks between Russia and NATO allies have only left the two sides at 

“Inflation that was about to peak and decline later this year will be affected by higher energy bills, in a context of tight households’ purchasing power.” 

Both Washington and Europe have threatened to 

 if it goes ahead and attacks Ukraine. Nothing is definite for now, but if the sanctions are severe, they could have 

 not only on the Russian economy but also on the European Union and the U.S.

Western governments have mentioned they could use 

 against Russia (although there has been no final decision on that so far): 

 flowing to Europe, with the Nord Stream 2 pipeline being postponed indefinitely: in this scenario, Europeans will see 

 as Russian President Vladimir Putin could decide to reduce gas deliveries to Europe as a countermeasure. 

“Inflation that was about to peak and decline later this year will be affected by higher energy bills, in a context of tight households’ purchasing power,” 

says Gilles Moëc, the chief economist of European insurer AXA. 

 messaging network: according to Maria Shagina, a fellow at the Zurich-based Center for Eastern European Studies this measure would be 

“devastating, particularly in the short term.” 

, trigger currency volatility, and cause massive capital outflows,” 

a vast messaging network used by over 11,000 banks

 and other financial institutions to quickly and securely send and receive information, including money transfer instructions.

What these geopolitical tensions could mean for gold? 

a safe-haven asset against geopolitical tensions

: border skirmishes, terrorist attacks, or civil wars have often pushed investors to 

a world map chess board symbolizing geopolitical tensions

Eventually, greater investor interest can end up impacting the price of gold and even push it up. 

Here are some examples of when the gold price was 

positively correlated with rising geopolitical tensions

 including the Iranian Revolution, the Iran-Iraq War, the Soviet invasion of Afghanistan, and the Iranian hostage crisis. The 

In 1986, during the U.S. bombing of Libya, the price of gold increased by 

 from the year before and then spiked again right after the 

 spreading and causing havoc in the world economy. 

Today, the gold price continues to be influenced by its 

 such as the U.S. inflation data and dynamics in the U.S. dollar. But, as history shows, geopolitical tensions can sap investors' appetite for risk, 

there’re still more questions than answers 

when it comes to Russia-Ukraine and China-Taiwan tensions, there are a couple of other ongoing issues that are worth keeping an eye on:

 it seems that a bitter trade battle between the world’s two largest economies is not over, as the U.S. has reportedly signaled it would keep a combative economic approach toward China.

Turkey’s soaring inflation and the crash of the lira: 

the country’s unconventional monetary policy has spooked foreign investors, who have been dumping Turkish assets, causing a worrying crisis in the region.

one year after the Jan. 6 attack on the U.S. Capitol, Americans are pessimistic about the future of U.S. politics (6 in 10 Americans believe U.S. democracy is in crisis).  With the U.S. being the world’s leading superpower, any long-term political and economic crisis in the country is bound to impact global markets.

All these events have the potential to upset global economies and markets in the future, so have you added some gold to your portfolio to hedge against geopolitical tensions?

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.

How to Buy Physical Gold Online in 2022?

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.

Weekly Digest: ECB Rate Hikes, Gold Up on Ukraine Tensions

Choosing between gold and silver: A comparison to help you decide which metal might be right for you.

Should You Buy Gold or Silver?

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.

The Fed’s Dangerous Game

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

Q&A with our CEO - Alessandro Soldati

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

Does the European Central Bank Want High Inflation?

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. 

Weekly digest: Ukraine Crisis, Markets Shaken, Gold’s Up

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.

Russia's New Move on Gold

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

Is Unlimited Debt Good for Gold?

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.

Ukraine-Russia Conflict: What Impact on Your Savings?

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.

What the K-Shaped Recovery Means for Gold

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.

Weekly digest: inflation rising, Russia sanctions, gold gains

You want to start investing but you don't know where to start? Here is a beginner’s guide to investing.

How to Start Investing in 2023? Here's What You Need to Know

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. 

How Do You Make Gold Bars?

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. 

Weekly digest: Metals on the Rise, Oil Drops, Crypto Order

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.

Central Bank Gold Buying Explained

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.

5 Ways to Protect Your Wealth From Inflation

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.

Weekly Digest: Fed’s 1st Rate Hike, Gold in Demand

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. 

Investor Gold Demand is Booming Right Now: Here's Why 

On August 15, 1971, U.S. President Richard Nixon possibly made the biggest monetary error in history. A video from Libre & Riche will tell you why.

All You Need to Know About the World’s Greatest Monetary Catastrophe

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.

Weekly Digest: Cost of Living Crisis, Inflation Problem

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. 

How Interest Rate Hikes Affect the Gold Price

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. 

Weekly Digest: EU Inflation Runs Hot, Ukraine Peace Talks

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.

Trump + Biden = Gold?

Do you want to buy gold bars but are not sure where to start? Here’s what you need to know to build your precious metals portfolio in a smart way.

How Do You Buy Physical Gold Bars? 

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.

Here’s How Rising Gas Prices and Inflation Fuel Each Other

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.

Weekly Digest: Inflation Worries, U.S. Recession

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.

What Is Stagflation and Why Should We Worry About It?

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 

Leading world banks say we should get ready for a new recession shock. What does it mean exactly, and what investments might be the best place to stash your hard-earned money?

Recession Risk is Rising, Economists Say. Here's What It Means for Investors

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

If you are a parent, you probably want to find the best way to set your kids up for financial success. Here’s how your gold savings will help you start building their lifelong wealth.

3 Ways Gold Savings Can Benefit Your Children and Family

Easy is always right. Especially when it comes to buying precious metals. If you still don’t know what’s the easiest way to buy gold, you’re in the right place.

The Easiest Way to Buy Gold and Precious Metals

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.

Weekly Digest: Russia’s Gas Cutoff, Musk’s Twitter Deal

If your children are the lucky ones to get a hoard of gold as an inheritance, there are 4 things you should do before passing it on to them.

4 Things to Remember When Buying Gold for Your Children

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.

Weekly Digest: Fed Rate Hike, Cuts to China’s Growth Forecast 

Here are the 4 handy tips you can immediately put into practice when buying physical gold for the first time.

How Do You Buy Gold? A Beginner’s Guide

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.

Swissmint Issues a New Limited-Edition Vreneli Coin

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.

Weekly Digest: U.S. Inflation, Stocks, Crypto Crash

The end of Bretton Woods seems to be an essential reason behind the widening of the productivity-pay gap that reveals gold's influence as a source of stability.

What is the Productivity–Pay Gap?

A quick overview of the performance of gold versus some of the major commodities for the first half of 2020.

🔥 Gold VS Commodities 🔥

You read in the press that persistently high inflation has finally peaked and should be going down soon. But the latest CPI numbers show it might not be entirely true. Here’s why.

Has Inflation Peaked? Here's What You Need to Know to Understand Inflation

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.

Weekly Digest: Dow Tumbles, Food Inflation Getting Worse

Since the start of 2022, the stock market has been on a wild ride, while gold was close to hitting a new record high in March. Which has performed better so far? We guess you already know.🙃

Gold Price Vs. Stock Market: 2022 Edition

While the Fed is taking a dovish stance, investors are fearing a real rise in inflation in the near future.

Is the Fed Moving Too Slow to Counter Inflation?

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.

Weekly Digest: Stocks Slump, ‘Messy’ Migration Risk in Europe

Have you been thinking of investing in platinum bars and coins? Here’s what you need to know about one of the world’s rarest precious metals.

Investing in Platinum: A Beginner’s Guide

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. 

Weekly Digest: Eurozone Inflation, Economic Hurricane

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.

Weekly Digest: OECD Cuts Growth Forecast, EU Inflation to Peak

Central banks are rushing to raise interest rates to tackle rising consumer prices in Europe. There are a few things we can learn from them about fighting inflation.

How to Fight Inflation? The Central Bank Edition 

Thanks to GOLD AVENUE, Tibo InShape was able to enter the famous gold refinery MKS PAMP. Watch the video and follow Tibo in his discovery of gold!

Tibo InShape & GOLD AVENUE: visit of a gold refinery in Switzerland!

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. 

Weekly Digest: Big Fed Hike, Recession Fears, Gold Could Soar

GOLD AVENUE’s CEO Alessandro Soldati was selected by Bilan magazine as one of French-speaking Switzerland's most promising young entrepreneurs.

Bilan Chooses GOLD AVENUE Among Switzerland’s Top Young Startups

If you are considering buying silver bars and coins, there are a few things you need to know first about one of the world’s most valuable and accessible precious metals.