A common question that we often get asked is “When is the best time to buy gold?” Gold has always been seen as a symbol of wealth and prosperity. During times of uncertainty, the value of gold often rises significantly, prompting many people to turn to it as a safe haven for protecting and preserving their assets.
In this guide, we’ll explore gold’s enduring value, how its price is determined, and crucial factors to consider when deciding if now is a good time to buy gold, from market trends to economic indicators. We’ll also dive into various ways to invest and tips to help you make the best investment choice.
Gold as a store of value
First, let’s explain why gold has stood the test of time as a store of value over thousands of years. Unlike fiat currencies like the British pound or U.S. dollar, gold is not tied to the performance of any government or economy. It is a finite resource that has been used as money across civilisations, and does not depreciate as a result of inflation or policy changes, making it a universal asset.
During periods of economic instability or when geopolitical tensions rise, investors often flock to gold because it’s tangible and globally recognised. It offers a hedge against inflation and currency devaluation, which is why many consider gold a “safe haven” asset because of its ability to hold or increase its value during uncertain times.
With all that said, gold is an excellent option for diversifying investment portfolios and reducing overall risk. By including gold in your investment mix, you’re not just aiming for potential growth; you’re also adding a layer of stability. Whether you choose to hold physical gold bars or coins, invest through ETFs, or explore gold-related stocks, it can play a valuable role in balancing your portfolio and protecting long-term wealth.
How is the price of gold determined in the UK?
When looking to buy gold bullion, it’s important to know how prices are benchmarked. In the UK, the London Bullion Market Association (LBMA) conducts daily “gold fixings” twice a day at 10:30 am and 3:00 pm. These fixings involve major trading firms and reflect the consensus of the market at specific times, helping establish a standard price used globally.
Spot price vs future price
There are two main types of gold prices: the spot price and the future price. Understanding the distinction between these two is key when assessing whether it is the best time to buy gold.
- Spot price: The spot price of gold is the current market price at which gold can be bought or sold for immediate delivery. It’s essentially the going rate for gold right now and serves as the basis for transactions involving gold bullion.
- Future price: These reflect the agreed price for buying or selling gold at a later date. Investors and traders speculate on the future value of gold and these can differ depending on numerous factors, offering insights into market expectations and potential price movements.
Gold prices in 2025
So far this year, gold has surged, with prices expected to average $3,675/oz by the fourth quarter of 2025 and reach $4,000 by mid-2026, according to J.P. Morgan analysts.
Ongoing geopolitical conflicts in the Middle East continue to push investors towards safer assets; meanwhile, central banks around the world, especially in India and China, have increased their gold reserves due to shifting global alliances, adding to market demand.
In the UK, fluctuations in the pound due to domestic policy shifts and trade relations have further affected gold’s price in GBP. After a period of de-stocking, there’s also significant room for further gold ETF inflows as confidence in traditional markets wavers; many are turning to investment funds to gain exposure to the metal without the need for physical storage.
Is now a good time to buy gold?
The short answer is: it depends. Live gold prices do not move in a linear fashion; they fluctuate. Gold doesn’t generate income or dividends, so its value is driven largely by how investors perceive risk and opportunity at any given time. Below are key factors that can help you assess whether now is a good time to buy gold or if it might be wiser to wait.
Economic Indicators
When inflation rates rise, the purchasing power of currency declines, leading investors to turn to gold as a hedge. Interest rates also cause prices to fluctuate. For instance, lower rates reduce the opportunity cost of holding gold, whereas higher interest rates can make gold less appealing, as investors might prefer assets that offer bigger returns.
Geopolitical events
Wars, political instability, and sanctions—all these external factors can cause significant economic uncertainty, often leading to a surge in gold demand since it is considered a safe haven asset. By staying informed about global political developments, you can strategically time your gold investments to capitalise on these price surges.
Dow/Gold ratio
If you’re considering the best time to buy gold, you might have come across the Dow/Gold ratio. This compares the stock market’s performance, represented by the Dow Jones Industrial Average, to the price of gold. A high ratio suggests stocks are expensive relative to gold, indicating it might be undervalued. A low ratio means gold is costly compared to stocks, possibly favouring stocks as a better investment.
Market demand and supply
Demand comes from various sources, including jewellery and technology. Large markets like India and China tend to drive up gold prices, especially during festivals and economic growth. But if demand exceeds supply, prices generally rise, while excess supply without matching demand can lead to price stability or declines.
Indian wedding season and festivals
India is one of the world’s largest consumers of gold, accounting for 25% of global demand. During the wedding season (October – February) families often purchase gold jewellery, bars, and coins as part of wedding gifts and dowries. On Dhanteras (the first day of Diwali celebrations), purchasing gold is believed to bring wealth and prosperity for the coming year, creating a further spike in demand.
Ways to invest in gold
There are several ways you can invest in gold, depending on your financial goals, risk appetite, and how hands-on you want to be with your investment. Whether you prefer the security of owning physical gold, the convenience of digital products like ETFs, or the potential growth of gold-related stocks, there’s an option to suit every type of investor.
Physical gold (bars and coins)
This is the most traditional method of investment. Buying physical gold in the form of bars or coins means you own a tangible asset, making it ideal for those who want direct ownership and long-term security.
You can purchase these and store them in vaults or at home. Many modern bullion dealers also allow you to buy gold with crypto, offering a seamless way to convert digital assets into something physical.
Gold ETFs
Exchange-Traded Funds (ETFs) track the price of gold with the fund holding actual gold bullion in secure vaults to back the shares. They are easy to trade through a standard brokerage and provide exposure to gold prices through the stock market.
You can also invest in smaller amounts compared to buying full gold bars or even some larger coins. Options like fractional 1/2 gram gold bars or smaller 1/2 ounce coins allow you to start investing with a modest budget.
Gold mining stocks
Investing in companies that mine gold can offer high returns, but also higher risks. These stocks often outperform gold during bull markets because rising prices boost their profits.
However, they can underperform in downturns due to factors like production costs, operational risks, and broader market volatility. So, while they offer growth potential, gold mining stocks are generally better suited for investors comfortable with equity market fluctuations.
Practical tips for the best time to buy gold
Now that you know how gold prices are determined and what affects them, here are some key tips for timing your gold purchases just right:
- Think about your investment goals: Before you start diving in, consider what you want to achieve. Is it for long-term financial stability? Or a quick profit? Clearly defining your goals will help you decide the best way to incorporate gold into your investment strategy.
- Buy gold during economic downturns: Historically, gold prices tend to rise during economic downturns. When stock markets are turbulent and economies are struggling, gold becomes a go-to asset for preserving wealth.
- Keep an eye on gold prices: Regularly monitoring gold prices can help you identify trends in the market. There are many financial news websites and tools that provide up-to-date information on gold prices.
- Don’t overreact to short-term price fluctuations: Gold prices can be volatile in the short term. It’s important not to panic or make hasty decisions based on daily price movements. Instead, focus on long-term trends.
- Buying in smaller quantities over time: This strategy, known as dollar-cost averaging, involves buying gold in smaller quantities at regular intervals. It reduces the risk of making a large purchase at an unfavourable price point and helps average out the cost over time.
Gold – A safe and secure asset
Whether you buy large 12.5kg gold bars, smaller 2g or 5g bars, or even Britannia coins, remember that physical gold offers independent, direct control over your assets, unlike money held in banks.
Before investing in bullion, carefully assess your personal financial situation and objectives. While making a profit is a welcome benefit, the primary aim should be to safeguard your wealth for the long term.
If you need further help, see our comprehensive guide on investing in gold for more information.
Buy gold online with Bullion Giant
So, now you know when to buy gold, why not check out our premium range of gold bullion bars? With a solid reputation and a strong track record, Bullion Giant is your trusted dealer known for delivering genuine and high-quality gold.
We offer a diverse selection from leading LBMA-approved brands such as Metalor, Umicore, PAMP Suisse, Heraeus and Valcambi to ensure you find the right fit for your portfolio. Plus, with transparent pricing at super low rates, free insured delivery and flexible payment options, Bullion Giant offers excellent value for your investment. Contact us today to enquire about our collection of gold products. Our team of experts will be on hand to assist you with any queries if you require advice on the best gold purchase for you.
