Economy
Is Gold An Inflation Hedge?
Many investors consider gold as a safe-haven asset, particularly during times of economic uncertainty. It has been valued for centuries due to its beauty and scarcity. However, one question that often arises is whether gold can act as an effective hedge against inflation. In this article, we will examine the relationship between gold and inflation and explore the reasons why many investors turn to the precious metal in times of rising prices.
Before delving into the topic, it is essential to understand what exactly inflation is. Inflation refers to the persistent increase in the general price level of goods and services in an economy over a certain period. When this occurs, each unit of currency loses purchasing power over time.
Why Investors Turn To Gold During Inflationary Times?
When significant inflation looms on the horizon, individuals tend to worry about their investments losing value.
This fear prompts investors to seek out assets that have historically acted as hedges against rising prices. While younger investors choose to invest in gold stocks, people who prepare for retirement usually choose from the best gold IRA accounts to safeguard their hard-earned funds. Below are the most popular reasons why people choose to invest in gold in the first place.
Historical Track Record
Gold has a long history of being used as a store of value throughout human civilization. Its scarcity and durability make it an appealing investment option during times when traditional currencies lose value due to inflation.
Limited Supply
Unlike fiat currencies controlled by central banks that can be printed at will, new sources of gold are relatively rare and costly to extract from the ground. This limited supply ensures that gold maintains its intrinsic value over time.
Universally Accepted Store Of Value
Gold has been widely accepted as a form of currency across cultures for centuries. Even today, central banks around the world hold significant quantities of gold in their reserves as a safeguard against financial instability or economic crises.
Tangible Asset Class
One crucial aspect that sets gold apart from other investments is its tangibility – you can actually touch it! Unlike stocks or bonds that exist only on paper or in digital form, gold can be held, admired, and worn. This physical presence can provide a sense of security during uncertain times.
What is The Relationship Between Gold And Inflation?
While gold has many qualities that make it an attractive investment during inflationary periods, the relationship between the two is not as straightforward as some might believe.
Historical Analysis
Looking back at past data provides us with evidence of gold’s potential as an inflation hedge. Historical analysis shows that gold prices have often increased during periods of high inflation or economic uncertainty. For example, during the Great Recession of 2008-2009 and more recently during the COVID-19 pandemic, gold prices soared.
Supply And Demand Factors
Demand for gold tends to rise when there are concerns about currency devaluation or rising prices. As investors seek out safe-haven assets, increased demand leads to higher prices. Economic uncertainty and inflationary pressures amplify this effect.
Investor Sentiment
Another factor that influences the relationship between gold and inflation is investor sentiment. When individuals anticipate inflationary conditions, they may rush to buy gold as a hedge against their fears, which subsequently drives up its price further.
Correlation vs Causation
Despite these correlations between gold and inflation, it is essential to acknowledge that one does not necessarily cause the other. Correlations show how two variables move together but do not always demonstrate cause-and-effect relationships. The increase in gold prices during times of rising inflation could also be attributed to other factors such as shifts in investment preferences or changes in international geopolitical dynamics.
Different Ways to Invest in Gold
Now that we understand why investing in gold holds such allure let’s explore some popular methods:
Physical Gold: Holding Tangible Wealth
One classic way of investing in gold is through physical ownership. This includes purchasing bullion bars or coins directly from reputable dealers. By holding tangible assets like these shiny golden coins right at your fingertips, you become an owner of wealth that can be easily accessed or sold when necessary.
However, storing physical gold does require consideration regarding security and insurance measures. For those who prefer a hands-off approach when it comes to storage, reputable companies like Goldco offer secure vaulting services along with flexible options for acquiring precious metals.
Exchange-Traded Funds (ETFs): Golden Access without the Weight
If you’re seeking a more convenient and flexible approach to gold investment, exchange-traded funds might be your golden ticket. These funds allow investors to own shares in a trust that holds physical gold under its custody. This indirect ownership grants you exposure to the price movements of gold without the need for storage or insurance concerns.
Well-established ETFs such as SPDR Gold Shares (GLD) and iShares Gold Trust (IAU) have gained popularity due to their liquidity, transparency, and ease of trading on major stock exchanges.
Gold Mining Stocks: Uncovering Hidden Potential
Investing in gold mining companies can offer additional opportunities beyond owning physical bullion or ETFs. By investing in well-managed mining companies with strong track records, you gain exposure to not only the price of gold but also potential company growth and dividends.
Keep in mind that investing in mining stocks carries additional risks compared to physically holding gold or ETF investments due to factors like operational challenges and geopolitical uncertainties. Thorough research and diversification within this sector are crucial steps when considering this avenue.
Sparkling Preparation: Setting Up a Gold IRA
Now that we’ve explored some prominent ways of investing in gold, it’s worth highlighting an exceptional option for long-term retirement planning – a Gold IRA! A self-directed Individual Retirement Account (IRA) allows you to hold precious metals such as gold within your retirement portfolio.
Companies like Goldco and American Hartford Gold specialize in helping investors set up these unique accounts, enabling them to grow their wealth while enjoying tax advantages associated with IRAs. Consulting with experts from reputable firms will ensure you make informed decisions regarding asset allocation within your retirement account.
Is Gold The Only Inflation Hedge?
While most commonly associated with hedging against inflation, it is crucial to recognize that several other assets can serve as hedges too.
Real estate has traditionally acted as a store of value over time due to its potential appreciation and income generation capabilities. During periods of high inflation, real estate investors can raise rents in response to rising costs, thus protecting their purchasing power.
Investing in commodities such as oil or agricultural products can also serve as an inflation hedge. These assets have direct links to the economy and tend to rise in value during periods of high inflation when demand exceeds supply.
Treasury Inflation-Protected Securities (TIPS). TIPS are government-issued bonds that provide protection against inflation by adjusting for changes in the Consumer Price Index (CPI). As inflation rises, the principal value of TIPS increases, providing investors with a real return above inflation.
Conclusion
By embarking on your gold investment journey, whether through physical ownership, ETFs, or mining stocks, you have the opportunity to participate in the enduring legacy of gold. And for those looking to secure their retirement savings with the radiant glow of gold, a Gold IRA can be the golden ticket to long-term financial success.
While gold has historically demonstrated an ability to retain its value during times of rising prices, it is essential to understand the complex relationship between gold and inflation.
Economic factors, supply and demand dynamics, investor sentiment, and historical precedent all play significant roles in determining gold’s performance during inflationary periods. It is always advisable for investors to maintain a diversified portfolio that includes a mix of assets suitable for various economic conditions.
By Adedapo Adesanya
Nigeria’s crude oil production slipped slightly to 1.422 million barrels per day in December 2025 from 1.436 million barrels per day in November, according to data from the Organisation of Petroleum Exporting Countries (OPEC).
OPEC in its Monthly Oil Market Report (MOMR), quoting primary sources, noted that the oil output was below the 1.5 million barrels per day quota for the nation.
The OPEC data indicate that Nigeria last met its production quota in July 2025, with output remaining below target from August through December.
Quarterly figures reveal a consistent decline across 2025; Q1: 1.468 million barrels per day, Q2: 1.481 million barrels per day, Q3: 1.444 million barrels per day, and 1.42 million barrels per day in Q4.
However, the cartel acknowledged that despite the gradual decrease in oil production, Nigeria’s non-oil sector grew in the second half of last year.
The organisation noted that “Nigeria’s economy showed resilience in 2H25, posting sound growth despite global challenges, as strength in the non-oil economy partly offset slower growth in the oil sector.”
According to the report, cooling inflation, a stronger Naira, lower refined fuel imports, and stronger remittance inflows are improving domestic and external conditions.
“A stronger naira, easing food prices due to the harvest, and a cooling in core inflation also point to gradually fading underlying pressures”, the report noted.
It forecast inflation to decelerate further on the back of past monetary tightening, currency strength, and seasonal harvest effects, though it noted that monetary policy remains restrictive.
“Seasonally adjusted real GDP growth at market prices moderated to stand at 3.9%, y-o-y, in 3Q25, down from 4.2% in 2Q25. Nonetheless, this is still a healthy and robust growth level, supported by strengthening non-oil activity, with growth in that segment rising by 0.3 percentage points to 3.9%, y-o-y. Inflation continued to decelerate in November, with headline CPI falling for an eighth straight month to 14.5%, y-o-y, following 16.1%, y-o-y, in October”.
OPEC, however, stated that while preserving recent disinflation gains is important, the persistently high policy rate – implying real interest rates of around 12% – risks weighing on aggregate demand in the near term.
By Aduragbemi Omiyale
The National Bureau of Statistics (NBS) on Thursday revealed that inflation rate for December 2025 stood at 15.15 per cent compared with the 14.45 per cent it put the previous month.
However, it recalculated the November 2025 inflation rate at 17.33 per cent after using a 12-month index reference period where the average consumer price index (CPI) for the 12 months of 2024 is equated to 100. This is a departure from the single-month index reference period, in which December 2024 was set to 100, which would have produced an artificial spike in the December 2025 year-on-year inflation rate.
The NBS had earlier informed stakeholders a few days ago that it was changing its methodology for inflation to reflect the economic reality. This is coming after the organisation changed the base year from 2009 to 2024 earlier in 2025.
In its report released today, the stats agency explained that this process was in line with international best practice as contained in the Consumer Price Index Inter-national Monetary Fund (IMF) Manual, specifically in Section 9.125 and the ECOWAS Harmonised CPI Manual, which address index reference period maximisation, following a rebasing exercise.
On a month-on-month basis, the headline inflation rate in December 2025 was 0.54 per cent, lower than the 1.22 per cent recorded in November 2025.
The NBS also revealed that on a year-on-year basis, the urban inflation rate for last month stood at 14.85 per cent versus 37.29 per cent in December 2024, while on a month-on-month basis, it jumped to 0.99 per cent from 0.95 per cent in the preceding month.
As for the rural inflation rate in December 2025, it stood at 14.56 per cent on a year-on-year basis from 32.47 per cent in December 2024, and on a month-on-month basis, it declined to -0.55 per cent from 1.88 per cent in November 2025.
It was also disclosed that food inflation rate in December 2025 was 10.84 per cent on a year-on-year basis from 39.84 per cent in December 2024, while on a month-on-month basis, it declined to -0.36 per cent from 1.13 per cent in November 2025 (1.13%).
This was attributed to the rate of decrease in the average prices of tomatoes, garri, eggs, potatoes, carrots, millet, vegetables, plantain, beans, wheat grain, grounded pepper, fresh onions and others.
By Modupe Gbadeyanka
Companies operating in Lagos State have been reminded of their obligations to file their annual tax returns for the 2025 financial year on or before January 31, 2026.
This reminder was given by the Lagos State Internal Revenue Service (LIRS) in a statement made available to Business Post on Thursday.
In the notice signed by the chairman of the tax agency, Mr Ayodele Subair, it was stressed that filing the tax returns is an obligation as stipulated in the Nigeria Tax Administration Act (NTAA) 2025.
He explained that employers are required to file detailed returns on emoluments and compensation paid to their employees, as well as payments made to their service providers, vendors and consultants, and to ensure that all applicable taxes due for the year 2025 are fully remitted.
Mr Subair emphasised that filing of annual returns is a mandatory legal obligation, and warned that failure to comply will result in statutory sanctions, including administrative penalties, as prescribed under the new tax law.
According to Section 14 of the NTAA, employers are required to file detailed annual returns of all emoluments paid to employees, including taxes deducted and remitted to relevant tax authorities. Such returns must be filed and submitted not later than January 31 each year.
“Employers must prioritise the timely filing of their annual income tax returns. Compliance should be part of our everyday business practice.
“Early and accurate filing not only ensures adherence to the law as required by the Nigerian Constitution, but also supports effective revenue tracking, which is important to Lagos State’s fiscal planning and sustainability,” he noted.
The LIRS chief disclosed that electronic filing via the organisation’s eTax platform remains the only approved and acceptable mode of filing, as manual submissions have been completely phased out. This measure, he said, is aimed at simplifying and standardising tax administration processes in the state.
Employers are therefore required to submit their annual tax returns exclusively through the LIRS eTax portal: https://etax.lirs.net.
Dr Subair described the channel as secure, user-friendly, accessible 24/7, and designed to provide employers with a convenient and efficient means of fulfilling their tax obligations, advising firms to ensure that the tax identification number (Tax ID) of all employees is correctly captured in their filings, noting that employees without a Tax ID must generate one promptly to avoid disruptions during the filing process.
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