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It’s never a bad idea to spend some time reviewing your investments. And with inflation still persistent if considerably cooled, and interest rates stuck at their highest point in decades, now is as good a time as any to take a closer look at where your money is invested. While owning stocks and bonds may be wise, especially after recent levels of stock market performance, they aren’t the only investment you should consider this spring.
In recent years, investors have also turned to gold. Investing in the precious metal took a hit 11-year peak last September and the price of the precious metal broke numerous records in the past year. With the end of March and the new inflation report and April Federal Reserve meeting, many may be wondering if now is still a good time to invest in the yellow metal.
Fortunately, for many investors, it still can be. Below we outline three reasons why you should invest in gold this April.
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3 Big Reasons to Invest in Gold This April
Here are three timely reasons to invest in gold now.
Inflation is still persistent
sure, inflation fell dramatically from a 10-year peak in June 2022, but is still growing but at a slower pace. In February, inflation rose by 3.2% year-on-year. That’s up from January and more than a point above the Federal Reserve’s 2% target. Against this background – and since no one knows for sure when inflation will be under control – it makes sense to invest in gold for April.
Gold often acts as a hedge against inflation by maintaining and potentially even increasing in value when other assets appear volatile and the value of the dollar erodes. It’s not always a direct correlation, but when inflation is consistent, as it has been for most of the past two years, gold often performs well. So now could still be a good time to invest.
Learn more about the benefits of investing in gold here.
Gold prices are up
The price of gold has already reached record highs twice this month, highlighting the interest and potential benefits investors can secure with the precious metal. And this price may go up even in April and the following months.
Therefore, it makes sense to buy now before the price becomes unaffordable. By doing this, investors will get the portfolio protection that gold provides immediately, while opening up the opportunity to sell the precious metal for a quick profit (a rarity for an asset not known for quick income production).
There will be other needs
Even if inflation is brought under full control, there will be other immediate circumstances where holding gold in the wallet will be beneficial. Geopolitical upheavals are high and this often leads to a demand for gold and a subsequent increase in the price.
An election year in the United States could also add to short-term economic uncertainty, and a high interest rate environment could also have an impact. Also, inflation is cyclical, so it will return at some point in the future. But if investors start with gold in April, they’ll be better prepared to handle it when it does.
The bottom row
There are always preferential times to invest in certain assets. Gold has experienced one of these momentum swings in recent months and years and is unlikely to correct dramatically next month. With inflation still steady, prices high and other economic indicators still unknown, it may be wise to invest in gold this April. Just remember to weigh advantages and disadvantages of the precious metal against your broader financial goals to improve your chances of investment success.
