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Seasonal Impact on the Price of Gold – What is the “January Effect”?

When is the best time to buy gold? And when is the ideal moment to sell precious metals? These are two questions often pondered by gold and silver market enthusiasts. Unfortunately, there is no universally correct answer to them. However, historical data shows that certain periods in the year tend to be more fruitful for the movement of precious metal values. In the stock market, the “January Effect” is well-known: a phenomenon in which stock prices generally rise at the beginning of the year. An analysis conducted by experts from the World Gold Council, presented by the Head of Global Research at this reputable institution, Juan Carlos Artigas, revealed that, on average, precious metals achieve higher price growth in January and late summer.


The January Effect


As Artigas notes, since 1971, gold has achieved an average return of 1.79% in January, almost three times higher than the long-term monthly average of 0.63%. During the same period, gold had a positive return in January in 60% of cases. In the period after the year 2000, this percentage increased to 70%.




The reason for the price increase at the beginning of the year could be due to increased physical demand for gold in the Far East, ahead of the lunar New Year, as well as portfolio rebalancing that typically occurs at the beginning of the year. Of course, this does not mean that the price of gold has risen in January every year. In fact, the last few years prove to be an exception to this “rule”. Gold had a negative growth in January 2021 and 2022, and the same situation repeated in January 2024, where the price decreased by 1.2% on an annual basis when considering the relationship between gold and the dollar.



These “exceptions” are typically the result of a stronger dollar, as confirmed by the information that the price of gold, measured in euros, recorded an increase of 0.5% between the end of January 2023 and 2024.


Summer Effect


In addition to January, the highest average price growth for gold is recorded in late summer. While historically, September was the key month for this, in the last two decades, the “gains” for precious metals have shifted slightly earlier – to August. Traditionally, as explained by the WGC, “this effect was associated with market positioning ahead of a strong period of gold demand, but our analysis shows that seasonal weakness in U.S. Treasury yields could be a more likely cause.”


Statistical data provide some insight into market trends, but it is always essential to keep in mind that historical indicators do not guarantee future events. The investment gold market is shaped by a range of macroeconomic, political, monetary, and economic events worldwide, which significantly impact prices.


Therefore, when deciding to buy, timely advice and monitoring value trends are more important than the “calendar season,” especially for individuals purchasing gold as a long-term investment and a hedge against inflation and asset depreciation.


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