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Gold as Inflation Hedge

by Chirag Sharma
Gold as Inflation Hedge

Inflation has been over 5% a year for many months.

North America and Europe experienced nearly identical ETF outflows, which outweighed record inflows in Asia. Those outflows are primarily a result of central bank policy.

While the US Federal Reserve began tapering bond purchases this month, it had limited influence on gold.

Meanwhile, despite the European Central Bank's pledge against interest rate hikes, investors appeared to react to decades-high inflation

It is no surprise to see that in October, there was a net outflow of 25.5 tons from gold-backed ETFs.

Furthermore, Gold futures net long holdings on COMEX rose, and vaulted gold prices remained strong, indicating that some investors may be transferring their gold ETF positions to physical exposure.

Controversially, Bitcoin has gradually emerged as a viable alternative to gold as a store of wealth in 2021, with the price of the cryptocurrency climbing dramatically, nearing to USD 68,000 per BTC.

Today, a prominent analyst noted: "Forget USD and QE: #bitcoin = 37 ounces of Gold." An illustration of how Bitcoin's value in gold ounces has increased steadily since 2010.

What do you think is the best inflationary hedging option?

  • Physical Gold

  • Digital Gold

  • Bitcoin

  • Net Long Futures

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