Eric Sepanek
SBC Founder
Eric Sepanek is the founder of Scottsdale Bullion & Coin, established in 2011. With extensive experience in the precious metals industry, he is dedicated to educating Americans on the wealth preservation power of gold and silver.
Gold is stealing some limelight from the broader economy with record-setting returns. Even as the S&P 500 and DOW mark their own records, gold’s rally is outperforming the entire stock market with an impressive 21% increase in 2024. Gold’s most recent high of $2,500/oz is spurring higher forecasts among Wall Street heavyweights, some even calling for a $3,000 price point. The combination of looming rate cuts and rising economic pain results in a positive outlook for the yellow metal.
The Numbers
- Gold has jumped by approximately 21% in 2024, outpacing the S&P 500.
- In August, gold prices hit a fresh record high, surpassing $2,500.
- Commerzbank Research has updated its gold forecast to $2,600 by mid-2025.
- TD Securities sees gold hitting $2,700 in the next few quarters.
- Central bank gold demand marked another high in the first half of 2024.
Why Investors Should Care
The gold market is currently marked by both uncertainty and excitement as prices reach all-time highs. Investors are questioning whether the rally will continue or if a pullback is imminent. However, with several key market influencers forecasting even higher gold prices, the momentum appears strong. The possibility of up to five rate cuts in the coming year points to a weakening dollar, which would likely boost safe-haven demand as stocks, bonds, and other dollar-backed investments become less appealing.
👉 Further Reading: Largest US Bank Predicts Higher Gold Prices Through 2025!
Market Impact
The Fed has been flirting with rate cuts for months, but analysts think slashes are right around the corner. The anticipation of a tighter monetary policy is enough to shift market sentiment. Investors are already pulling out of conventional, dollar-linked investments in favor of physical assets such as precious metals. This shift is reflected in gold prices which have shot up throughout 2024, recently reaching fresh highs. A chorus of big names on Wall Street have forecasted further gold growth, underscoring the market’s confidence in the yellow metal.
Expert Insights
Carsten Fritsch, a senior commodity analyst at Commerzbank Research, noted, “We expect the gold price to rise further to $2,600 by the middle of next year.”
Bart Melek, TD Securities’ global head of commodity strategy, iterated the bullish sentiment, predicting that gold could hit $2,700 “in the coming quarters.”
If those forecasts weren’t impressive enough, a senior director of business development at American Precious Metals Exchange, Patrick Yip, predicts “Gold could reach $3,000 as soon as next year.”
Highlighting the agreement among major financial movers and shakers, Scottsdale Bullion & Coin’s Precious Metals Advisor Todd Graf points out “These Wall Street firms are unanimous. They all think that gold is going up.”
What’s Behind the News?
Several factors are driving up gold prices behind the scenes. Deteriorating economic conditions, including rising inflation, anticipated rate cuts, and a devaluing dollar, are prompting a broad shift into gold. However, the impact of central bank gold buying cannot be overstated. Major players like China, Turkey, and India are aggressively increasing their reserves, further pushing gold prices higher. The People’s Bank of China, after an 18-month gold-buying spree, briefly paused only to resume with new gold quotas, reflecting the strong demand from central banks.
Future Outlook
The World Gold Council anticipates a continued increase in central bank gold demand, following the record-setting purchases seen in the first half of 2024. Additionally, surveys indicate that fiscal leaders globally are committed to further augmenting their gold reserves. This growing demand has led many experts to raise their gold price forecasts accordingly.
Actionable Takeaways
Diversify Your Portfolio – Portfolio diversification is increasingly important as experts anticipate an economic storm on the horizon.
Invest in Physical Gold – Robust central bank demand and worsening economic conditions are expected to drive physical gold prices even higher.
Talk With an Advisor – Consult with a financial advisor to tailor your investment strategy to current market conditions and your long-term financial goals.
Want to Diversify With Gold?
The precious metals advisors at Scottsdale Bullion & Coin are here to help! Contact us today by calling toll-free at 1-888-812-9892 or using our live chat function.