gold price up post covid

Covid pandemic drives gold price up

Not surprisingly, the gold price soared last year. There’s nothing like a global pandemic to force us to re examine our priorities. Amid all the uncertainty, there was one thing we knew we could depend on: the proven, solid reliability of gold.

Since our earliest civilisations, gold has been a trusted universal measurement of wealth. Think ancient Egypt, where tombs and temples were lavishly decorated with gold. Gold ornaments, cups and jewellery have also been discovered in burial sites of nobles in ancient Greece. Around 600 BC, the first gold coins were minted in Lydia, an ancient kingdom in what is now known as Turkey, paving the way for our modern monetary system.

Fast forward to 2020 – a year when millions of jobs were shed around the world as countries went into lockdown. Entire sectors of the economy collapsed. Banks cut interest rates, effectively reducing the value of savings and investments. Financial experts predict that low interest rates will persist into the future. In this environment, gold really shone.

Gold price increase

According to Forbes magazine, the year of Covid-19 was also the year of gold. The pandemic drove a huge increase in demand for bullion and gold coins, such as the Britannia.

In fact, the World Gold Council says that, “Global demand for gold hit a record-breaking 1 773 tons last year.” This is 40% up on the previous year. Much of this gold was in the form of bullion bars. But gold bullion coins are increasingly popular among private buyers because they are more readily available. They are far easier to buy and sell, transport and store.

Selling your gold Britannia coins

If you bought 1 oz gold Britannia coins prior to the pandemic, you should be able to sell them right now at a profit, since the value of these coins is directly linked to the gold price. Each coin contains 1 troy ounce of pure gold. So you can get a rough idea of the value of your coins simply by checking the current gold price (US$1 787 per ounce at the time of writing). “Rough” because obviously gold dealers need to make a profit. Shop around online to find the best prices offered in your country.

The gold price is always quoted in US dollars, so if you live in the UK, you need to convert this to pounds at the current rate of exchange. If you are a UK resident, selling Britannia gold coins or gold sovereigns in the UK, the good news is that there is no Capital Gains Tax (CGT) payable, because these coins are considered legal tender. This does not apply to other popular gold bullion coins you might own, such as American Eagles, Canadian Maple Leafs and Krugerrands.

Why buy 1oz gold Britannia coins?

If you have been fortunate enough to have weathered the Covid-19 economic storm, there’s no reason to sell your gold coins right now. Gold will always remain a wonderful safe haven. In fact, you may want to think about buying more. Here are five reasons why it makes sense to buy 1 oz gold Britannia coins now:

  • Their value is not affected by interest rate cuts
  • They are real and dependable, unlike crypto currrencies which may or may not stand the test of time
  • Their value goes up in times of crisis
  • They have proven to offer better safe haven properties than stocks and shares, or even other precious metals like silver and platinum
  • They are easy to trade – anywhere in the world

Gold is an integral part of many private investors’ portfolios. It offers a worthwhile alternative to financial assets and cash savings. And whilst the gold price fluctuates daily, over time it continues to offer a reliable return.

If you are thinking of buying gold bullion coins for the first time, read more here.

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