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Gold Prices during COVID-19: Massive lockdown during the first wave

Covid-19 has been tough on the world since the beginning. As you already know that the whole world went into a massive lockdown during the first wave. This is kind of repeating itself as the second lockdown due to covid-19 is already taking effect in various parts of the world. The most affected element during this pandemic crisis has to be the economy. It kind of flat-lined when the whole world was under lockdown and people started losing their jobs and the panic spread like a forest fire. Today Gold Rates are up and they will continue to climb amid the Covid-19 pandemic. The very reason is that people are still out of jobs, the economy is in ruins and the market is hanging by a thread.

Pre-pandemic situation

Before it was anything remotely related to a worldwide pandemic, people didn’t take Covid-19 as seriously as they should have. Gold prices were unction moderately as there was only a regular toll on it. These used to rise and fall just fine within a range that the market allowed for. You would also notice that before the pandemic there was not a sudden rise among the gold prices. The 10K Gold Rate remained as subtle as anything else. It followed a steep rise and an even steeper fall throughout the years or even months before the pandemic was to hit the world.

During the pandemic

Once Covid-19 started rolling and it took the whole world under its drapes. Now is the time when tension is at an all-time high. The time when panic took over, and the time when the economy of the world completely collapsed. Even the developed countries such as the USA, EU, UK, and Canada were having a hard time dealing with the artificial recession and collapse of the economy created by the pandemic. People lost their jobs and as a result, the global markets were crashing here and there. As a result, any asset that has any value assigned to it was at an all-time high, this did include gold. You might not have seen a rise that sudden and quick as it happened with gold. It was kind of skyrocketing not over the week but over the night.

During the whole pandemic situation, gold prices remained on the upper levels while pushing the flight of other metals below it. Investors who had already bought tons and tons of gold made some serious fortune during this period. While the general public had to sink beneath the weight of it all.

Post-pandemic situation

Now when the first wave of Covid-19 is over, the gold prices are coming to their senses. You can eventually find the 22K gold Rate to be fairly close if not exactly the same as it used to before the pandemic hit. But the ripples of the pandemic are to be felt for years to come. And might not be possible for some nations to fully recover from its effects rather instantly but they will have to try to stay afloat. After this storm has passed, well, the first wave anyway. The prices of gold and other essential metals are coming to their original place slowly. But no one can say about the future as the second wave is on the shore. What can be expected from the gold prices and the world economy in general?

According to World Bank President David Malpass, a minimum of a couple of economies are likely to seek out themselves with debt loads. Well in more than 150% of GDP during a worldwide recession within the aftermath of COVID-19.

Mark Mobius, the veteran emerging-markets investor recently stated, “the trend for gold goes to still go up. Even after recent volatility as declining interest rates and funds browsing the roof is supportive of bullion prices”

Investors should recall the old market adage. “He who has to take advantage of a recession is king”.

Kings and queens and even emperors over the ages often wisely preferred gold to (highly) indebted government-issued folding money. Investors should note just in case the emperor exposed to the present deadly and contagious virus has no clothes.

abubakarbilal

Abubakar is a writer and digital marketing expert. Who has founded multiple blogs and successful businesses in the fields of digital marketing, software development. A full-service digital media agency that partners with clients to boost their business outcomes.

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