2024 Gold Market Forecast

With the new year well underway, investment markets are gaining new traction across the board. In particular, the price of gold peaked at the end of 2023 to over $2,000. This publication will dive into drivers behind gold’s latest surge as well as provide a forecast of the gold price trajectory in 2024.

History

For the first time in its millennium, the price of gold exceeded $2,100 per ounce on December 4. However, this surge did not last, causing the commodity to pullback below the $2,000 threshold due to stronger than anticipated US macroeconomic data.

Despite this decline, gold is nevertheless looking well for 2024. Investors are still purchasing gold, allowing its price to drive back up to more than $66 per gram, due to expected pacifistic bank policies and low bond yields.

Drivers

Many factors affect the price gold price, however recent analysis show that it will most likely be strongly influenced by major central banks in the current new year.

Last year gold price interest rates were maintained between 5.25% and 5.50%. However, central banks are now forecasting three rate cuts by the end of 2024. This leads us to believe that policymakers are softening their stance.

As such, gold markets are predicting pricing rates to go down to 4% by the end of 2024. However, this prognosis may be too auspicious, as it calls for a massive decline of six cuts 0.25% over the course of the term.

Forecast

Most gold predictions that have been made public thus far are optimistic, with many analysts projecting that gold will rebound its all-time high in 2024.

According to surveys, the majority of industry experts had a rather optimistic outlook for gold, believing it would average to about $2,000 by 2024. Further analysis predicts there may be more gold rallies in the latter half of the year due to its price averaging out in Q4. Geopolitical risks remain as the primary factor affecting these prices, however experts believe the primary threats to gold in the new year are a hawkish Fed and a strong US dollar.

Nevertheless, such bullish hypothesis not only represent a high for gold market prices, but also sets a new standard, changing the way that gold is valued.

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