Gold Prices Soar to Record Highs in 2024
As the year comes to a close, gold prices have reached unprecedented heights, driven by a combination of factors including robust central bank buying, geopolitical tensions, and monetary policy easing by major global banks.
A Stellar Year for Gold
Spot gold prices rose 0.3% to $2,614.23 per ounce, while U.S. gold futures added 0.3% to $2,626.20. According to Tim Waterer, chief market analyst at KCM Trade, “Gold enjoyed a stellar year in 2024, largely due to the expected transition towards a lower interest rate environment.” As a result, bullion has gained more than 26% year-to-date, marking its biggest annual jump since 2010.
Record-Breaking Rallies
Gold prices have been on a tear throughout the year, scaling a record high of $2,790.15 on October 31. The market is now awaiting fresh catalysts, including a slew of U.S. economic data due next week, which could influence the Federal Reserve’s interest rate outlook for 2025.
What’s Ahead for 2025?
For next year, the U.S. interest rate outlook will remain a primary driver of the gold price. President-elect Donald Trump’s tariff policies will also play a key role in shaping the inflationary picture, the Fed’s interest rate trajectory, and ultimately, the gold price. As Waterer notes, “Trump’s trade policies will be crucial in determining the gold price in 2025.”
Central Banks and Geopolitical Risks
Aneeka Gupta, director of macroeconomic research at WisdomTree, believes that gold will remain supported in 2025 by rising geopolitical risks, trade tensions, and ongoing demand from central banks. While the stronger U.S. dollar and slower pace of easing by the Fed may pose headwinds, Gupta expects gold to remain a hedge against inflation and turmoil.
Other Precious Metals
Spot silver steadied at $28.94 per ounce, while palladium gained 0.5% to $904.96 and platinum rose 1% to $912.77. Silver is headed for its best year since 2020, with gains of over 21% so far. Platinum and palladium, on the other hand, are set for annual losses, dipping about 7% and 17%, respectively.
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