Gold rush in Hungary: people spent over 1.2 billion forints (3,3 million euro) on gold

Despite the raging crisis, auctions are still hugely popular. BÁV is the market leader in the Hungarian pawnshop.

Although BÁV was forced to hold its auctions online due to the epidemic, it still received a record number of orders. At one of its autumn events, for example, it sold a pair of earrings decorated with 8 carats of perfect diamonds for 11 million forints,

and at the company’s Christmas live online auction a bracelet was sold for 3.6 million.

As Ádám Kovács, Commercial Director of BÁV, told növekedés.hu

There has been a visible tendency perhaps since the beginning of this year that not only investment gold bars but also the purchase of gold jewellery has been now considered a kind of investment or saving, primarily among retail clients.

At the end of the year classic jewellery in the price range of 50-100 thousand forints also sold well. These, of course, are usually purchased as gifts during the Christmas period.

Wedding and engagement rings are also in high demand, especially now in the festive season.  

Investment gold bars have become a hot item, which is not surprising, of course. When there is a lot of trouble in the world and the money markets are in turmoil, the demand for this precious metal always soars. It is no coincidence that it is also called a “safe haven investment”. Sales in Hungary reached record levels when the epidemic first appeared in March. The turnover of investment gold bars at BÁV then reached 448 million forints, while sales in October and November also amounted to nearly 300 million forints.

By the end of November this year, more than 1.2 billion forints worth of investment gold had been sold, which is an increase of almost 70 percent compared to last year.

And the year is not over yet. As Christmas is approaching, we are seeing further growth, which is because smaller gold bars, typically 5 gram and ½ ounce ones are also popular as Christmas gifts. This year, all of our research has shown an increase in financial awareness among customers, so this trend is expected to continue

Ádám Kovács explained.

We also asked the Commercial Director of BÁV about expectations for gold in 2021.

In this regard, he said that the effects of the coronavirus are certainly here to stay at the beginning of next year, so demand for gold is expected to remain high.

However, the tension caused by the pandemic will be gradually eased by the good news about vaccines, and this could also affect the price of gold as a classic safe haven. It does not mean, though, that the factors driving gold prices up will disappear. Inflation fears will intensify significantly in 2021, and there are several analyses forecasting the weakening of the dollar, and all these could lead to a rise in the price of gold.

With that in mind, there are well-founded forecasts predicting that the price may reach 2,300 dollars per ounce next year.

Ádám Kovács noted that he personally did not want to make predictions in this regard. At the time of writing, the price per ounce was around 1,850 dollars.

The price of gold in the past

Year	Annual average value per ounce (in dollars)
1985	317,42
1990	383,73
1995	384,07
2000	279,29
2005	444,99
2010	1 226,66
2015	1 158,86
2019	1 393,34