Beware the ides of March, indeed – at least for gold investors. The current price of gold continued to fall for the second straight month. Here are some of the factors that broke the seven-month stretch of gains for gold:
- The Federal Reserve announced at the beginning of the month that it expects to raise interest rates in the U.S. later this year, causing investors to seek other investment options such as stocks and bonds.
- The growing strength of the dollar has limited foreign buyers of gold, including India. The Indian market was also stagnated as buyers waited for their government to decrease the hefty 10% tariff on imported gold. The government’s decision not to lower the tariff frustrated the Indian market.
- While investors had been excited that the price of gold could get a boost from the demand created by the Apple iWatch, the product reveal revealed that the watch contains much less gold than anticipated, and the exorbitant price makes the gold watch a niche buy, meaning the demand on supply will not be as significant as anticipated.
Though some investors may be disappointed in the lower price of gold, for investors who are interested in gold for its long-term potential and protection against fluctuating and volatile markets, now’s a great time to buy.