However, many gold owners were disappointed that gold, as a hedge against inflation, did little to benefit from the massive increase in inflation this year and did not even offset the depreciation of paper money.
While the annual inflation rate in the Eurozone in November amounted to 10%, the yellow precious metal over the twelve-month period in euro terms added only 6% in value. In addition to increased opportunity costs (losing interest rates), the astounding strength of the US dollar has also acted as a drag.
Basically, however, it must be said that gold has clearly outperformed the two most important asset classes, stocks and bonds, and thus definitely justified its role as asset protection in the investment portfolio.
Especially compared to German bonds, which in the past were also considered a "safe haven", but the yellow precious metal outperformed them by 25%. Only in relation to the Bloomberg Commodity Index and the dollar index, gold turned out to be a less profitable investment alternative.
One of the reasons for the strength of the US dollar and the weakness of gold this year was the military conflict between Russia and Ukraine, which led to a massive flight of capital into the US dollar, as well as the rise in the price of important fossil energy sources such as oil and gas. Since the European economy is largely dependent on imports of commodities, the positive dynamics of the US currency and the entire commodity sector did not come as a big surprise.
In most other major currencies, gold has certainly proven to be an "anchor of stability" or a "safe haven" in turbulent times. The Japanese owners of gold, for example, recorded an increase in the value of the precious metal by more than 16% in their national currency.