Analysts have revised their 2024 gold price forecasts upwards, expecting a “perfect storm” of factors to propel the precious metal to record-breaking levels this year. According to a Reuters poll, analysts and traders are now predicting gold will reach a median price of $2,190 per troy ounce in 2024, up from the previous forecast of $2,053.50 three months ago.
The factors driving this bullish outlook for gold include simmering geopolitical tensions, robust central bank buying, expectations of a U.S. interest rate cut, and China’s continued strong demand for the safe-haven asset. These conditions have already seen gold hit a record high of $2,431.29 per ounce on April 12, with the metal adding more than $250 so far this year.
“Sentiment towards gold remains bullish amid spiralling geopolitical risks, elevated equity markets, stubborn inflation and slower rate-cut expectations,” said Standard Chartered analyst Suki Cooper. “We do not rule out higher highs before prices correct.”
Gold typically thrives in a low-interest rate environment, and investors are now only confident about a single rate cut from the U.S. Federal Reserve this year, most likely in November. Additionally, central banks around the world have been actively buying gold as a hedge against currency depreciation, geopolitical instability, and the need to maintain robust reserves.
Analysts also cited increased physical demand, particularly in China, as a supporting factor for gold. “Strong retail demand in China amid the desire to park money in a sector seen relatively immune to a struggling economy amid deepening property woes and the risk of the yuan devaluation” is also contributing to gold’s appeal, said Ole Hansen, Saxo Bank’s head of commodity strategy.
With this perfect storm of bullish factors, the outlook for gold in 2024 is highly positive, with analysts expecting the precious metal to eclipse previous record highs as investors seek refuge in its safe-haven status.