Due to the corona crisis, the price of physically immediately available gold and the cost of paper gold, i.e. the stock exchange price for gold, have contrasted more than ever.Precious metal prices are created on the international stock exchanges. There, many wholesalers and funds currently had to sell part of their gold due to COVID-19 because money was needed for upcoming obligations or necessary portfolio requirements had to be met. That is why the gold price initially fell.Nevertheless, precious metal traders are currently experiencing very high demand, a real run on gold. Since precious metal is traditionally a safe and stable investment, private investors are currently increasingly investing in real assets.
Fear of recession
Many people fear a recession in which their money loses its value. Investors also fear that the market will be flooded with freshly printed money in order to stimulate the economy again after the crisis.Should there be a financial crash sooner or later, one kilogram of gold always remains one kilogram of gold. In addition to increasing demand, the fact that numerous mints had to temporarily close due to the corona virus or reduce their production, which leads to a significantly limited supply of coins and bars, is also driving prices up.