Is the gold price ready to surprise investors again?
Stable value
Posted by MoneyController on 20.09.2024
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Gold is a safe haven asset that has experienced great success among investors in recent years and, above all, in terms of price. How might the price trajectory of the precious metal continue in the coming months?
Weeks go by and gold continues to see its value rise. As Vitaliano D'angerio explained on the ‘Market Mover’ programme (Il Sole 24 Ore), it is mainly risk factors that drive investors to invest in the safe haven asset: from changes in interest rates to geopolitical risks. For example, explains D'angerio, should Trump win the US elections in November, his administration could escalate the trade conflict with China.
But how far could the price of gold go? Of course, it is impossible to make exact predictions. Nevertheless, the investment bank Goldman Sachs sees a possible price target of USD 2,700 in the first half of 2025. FONDS Professionell, on the other hand, reports on the forecasts of DZ Bank Research, which does not exclude that the yellow metal could even reach a price of $2,800 per ounce in 2025.
As Thomas Kulp, analyst at DZ Bank, explains, one of the factors that has contributed most to the rise in the price of gold is the massive purchases by some central banks, namely the banks of India and China. The volume of gold purchases made between 2018 and 2023 by the central banks of China and India amounted to 650 tonnes. This hunger for gold is also explained by the desire to emancipate themselves from the dollar as a safe haven currency.
But Kulp points out that countries not interested in the Brics strategy are also buying gold through their central banks. In this regard, Kulp mentions the case of Poland, from whose National Bank, in July 2024, came the greatest demand for gold.
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