The price of gold has been volatile lately, as the price rallied past $1,700, cash for gold buyers report an unprecedented surge of jewellery being sold. With mining operations scaling down and some refineries shutting down, scrap gold has made up for shortages. Right now gold jewellery and other scrap gold products make up 30% of the current gold supply.
Over the last two months, gold buyers have been dealing with people throughout the world frantically pushing to sell whatever gold they had for cash amid worries about unemployment, weakening currencies and plunging global economies. Jewellers are also seeing a spike in the number people bringing their precious jewels for appraisals. This was to be expected as gold often is regarded as the one commodity you can fall back on in times of crises.
Most gold buyers expect more sales when the gold price rises. And there is no question of whether it will rise or not, it’s a matter of by how much and for how long. There are so many questions left unanswered about the coronavirus and its ultimate effect on the global economy, there is nobody saying they want to wait for the gold price to go up more, they understand it could be time sensitive.
When the price went about $1,550 analysts became concerned about the price rally, however it continued onto $1,689.34 but as more investors sold more of their gold to cover their losses, gold slipped to $1,563.07. But as soon as that happened, the price rallied even harder.
What gold buyers have noticed is that the heaviest days for scrap jewellery sales are the ones where gold seems to be sliding. This proves that people are hedging as much of their bets as they can.
The race seems to intense in the U.S and in Europe, but things are different in China. The sale of gold jewellery there are expected to plummet as the damage to economy due to the Coronavirus crisis grows wider. People are avoiding public spaces and shopping for anything that is not a basic necessity is avoided.
An 18-carat gold wedding ring weighing 10 grams would be priced at $383 when the spot price is around $1,600. A gold watch that weighs about 3 ounces that cost a $1,000 in the 80s would gain the buyer about $1,900.
High-quality branded watches like Rolexes and some expensive gold jewellery from brands like Tiffany or Cartier are valued for more than just their gold value but for their resale value. These are not bought to be melted but rather to be resold. High-end branded jewellery is not priced the same way as other jewellery.
For weeks now gold buyers phones’ have been lighting up like it was Christmas and traffic on their websites has grown. People been sitting with gold at home thinking whether it was time to sell are coming out of the woodwork.