In 2023, gold prices made a significant jump, soaring from approximately $1,823 per ounce to $2,062 per ounce, marking a 13% increase and making it the best-performing year for gold since 2020. On December 4, the price reached a record high of $2,135.40 per ounce. The outlook for 2024 is optimistic, with experts anticipating further price gains.
Preppers and survivalists should take note of the potential for gold to serve as a safe-haven asset during uncertain times. As we enter 2024, experts, including Saxo Bank’s Ole Hansen, attribute the expected price increases to factors such as momentum-chasing hedge funds, ongoing gold purchases by central banks, and renewed demand from ETF investors.
Financial institutions like JP Morgan predict a “breakout rally” for gold, especially in the middle of the year, driven by Federal Reserve interest rate cuts. They project a peak gold price of $2,300. UBS, on the other hand, anticipates gold prices to reach $2,150 by the end of the year if rate cuts materialize.
Throughout 2023, gold experienced fluctuations influenced by events like the U.S. banking crisis in May, which temporarily pushed prices down. However, geopolitical tensions, such as the Hamas attack on Israel in October, led to a subsequent rise in gold prices.
The World Gold Council (WGC) reported that global central banks collectively purchased a substantial 800 tons of gold in the first three quarters of 2023, indicating a 14% increase compared to the same period the previous year. The WGC’s Gold Outlook 2024 report outlines potential scenarios for gold prices based on the economic landscape.
In 2024, the WGC will identify major global elections and geopolitical risks in the United States, India, the European Union, and Taiwan. This, coupled with a potential recession, could heighten investors’ need for portfolio hedges, making gold a strategic allocation.
However, caution is advised, as some experts warn against blindly investing in gold. Factors such as the strength of the U.S. dollar, which typically has an inverse relationship with gold prices, and the uncertainty surrounding interest rate cuts should be considered. JP Morgan anticipates the U.S. dollar to remain at “elevated levels” in 2024, possibly reaching “new highs.”
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