Gold Leads 9th Annual Precious Metal Price Gain

Gold has become a stalwart leader in precious metal prices as gains were recorded for the ninth consecutive year. While the value of the dollar dropped against other major currencies due to the economic concerns in the United States, gold and other precious metal prices soared.

Gold has been the big gainer in precious metal prices with an annual increase of approximately 25%. This rise has been attributed to both demand and continuing economic factors that work in gold’s favor. As the US government initiated billions in new spending, the flood of new money weakened the dollar, allowing the price of gold to rise.

The 2010 outlook for gold and other precious metal prices is favorable as well, with gold futures rising on speculation of inflationary pressures in US financial sectors. The US Treasury hinted in December of possible interest rate increases, a move that can stimulate growth but can also raise inflation. News like this has caused some analysts to speculate that precious metal prices for gold could be back in the $1,200 range by January and possibly as high as $1,350 later in 2010.

Many people see gold as a currency hedge. Physically held gold can protect an investor when inflation sets in and precious metal prices begin to rise. In the event of a major financial crisis, this gold can even be used as an alternate currency, offering greater security to the investor.

With the specter of inflation looming and gold and other precious metal prices rising, the market for gold, silver, platinum and other metals has the potential to be strong again in 2010. Investors should utilize sources such as precious-metal.org to monitor trends and to make any necessary adjustments to their precious metal holdings.

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Danny Burns

Senior Staff Writer - Precious-Metal.org