2012 Market Review & Yearly Summary [Gold & Other Precious Metals]

2012 was a tricky year for gold bugs as it was riddled with both losers and gainers depending on their position in the market when gold prices fluctuated periodically. Eventually towards the end of the 2nd quarter demand for gold bullion tapered off, shrinking by close to 12 % amounting to 67.4 billion US dollars in comparison to the previous year’s 76.6 billion dollars. However as summer arrived there was a renewed positive sentiment towards the precious metals industry that up started the precious metal industry significantly enough to prevent investment demand for gold from shrinking further.

On the other hand, demand for gold from the industrial and jewellery factions remained resilient and the precious metal market strived even further, prices peaked at 1,746 dollars per troy ounce in October 2012 before losing momentum in the subsequent months and finishing of the year at 1,641 dollars. The lowest average point for gold in 2012 was 1,591 dollars per troy ounce. As markets and as economies recovered, the capital markets began to make a comeback towards the end of 2012, sparking interest in capital markets and a shift in investment funds that started the downward trend of gold prices once again.

The events that transpired in 2012 paved for a new approach towards gold investments in 2013 as market players expected demand for gold from the jewellery factions to soften, which in turn had a significant effect on investment gold demand which spurred new types of gold related investment derivatives. The announcement by governments of a duty hike on the import of gold also played a significant role in spurring demand as both jewellers and investors started to stockpile gold ahead of the duty hike.

EvenRegular consumers who were planning to buy gold in the near future were observed to have brought forward their purchases.

The diverse set of elements that were at play in 2012 kept gold prices from being manipulated by bigger market players; this situation still sustains the precious metal industry to this very day.