All that glitters is not gold. But 2024 can literally be called the year of gold, in which prices of the precious metal broke one record after another, increasing by almost 27% and reaching the historic high of 2,748.23 dollars per ounce in the last week of October and then falling back to 2,620.56 dollars at the end of the year. A very respectable figure. Gold’s rally has no recent precedent: the yellow metal surpassed important psychological thresholds, first reaching 2,500 dollars an ounce, then exceeding 2,700. An extraordinary performance comparable to that of 2010, when gold rose by 29% during the emergence of the debt crisis in the Eurozone, and to the critical years of 2007 when the world economy was on the brink of the Great Recession. In a global context marked by economic instability and geopolitical tensions, gold is proving to be one of the best resources for protecting one’s assets. Demand continued to grow in 2024, driven by central bank investments and increased international uncertainties.
Investor attention is now focused on the Federal Reserve’s rate strategy for next year and President-elect Donald Trump’s future tariff policies. After cutting rates aggressively in September and November of this year, the Fed continued with the cuts in December but hinted at a reduction in the rate cuts in 2025 (‘only’ two from the four estimated in September). The latest reading of US inflation eased concerns about the pace of cuts next year. However, markets continue to expect easing of just 35 basis points by 2025.
Currently, the uncertainty of the financial markets, the increase in interest rates and the growing international tensions are pushing investors to seek protection through gold. Which has a long history as a refuge during times of crisis. In 2024, investors returned en masse to gold to protect their capital from the volatility of stock markets and economic difficulties linked to inflation, geopolitical conflicts and growing monetary instability. Despite the possibility of some temporary correction, analysts’ forecasts remain optimistic. JP Morgan predicts gold will top $2,800 an ounce by early next yearwhile BofA does not exclude that it could reach $3,000. With such momentum and such strong support, gold presents itself as a solid and safe investment option for the coming months as well.