This week, Reuters reported that as uncertainty about the prospects for the global economy fester, the safe-haven demand generated by that sentiment is expected to send gold to even higher levels in 2024, according to industry experts.

After hitting an all-time high of $2,110 per ounce earlier this month due to investor demand from recession fears and expectations of interest rate cuts, bullion ended the year at $2,063 per ounce, for over a 13% year over year gain, its first yearly gain in three years. Additionally, increased geopolitical tensions in the Middle East increased the safe-haven appeal of gold. According to the analysts Reuters consulted with all of these factors are expected to persist into 2024  and continue to support the rise in gold prices.

In an interview with Reuters, Saxo Bank’s Ole Hansen said, “Following on from a surprisingly robust performance in 2023 we see further price gains in 2024, driven by a trifecta of momentum chasing hedge funds, central banks continuing to buy physical gold at a firm pace, and not least renewed demand from ETF investors.”

Meanwhile JPMorgan is predicting there will be a “breakout rally” in nid-2024 for gold, with a forecasted peak of $2,300 to occur when the Federal Reserve cuts rates. UBS forecasts a peak of $2,200 by the end of next year due to a combination of inflation and heightened geopolitical risks.

The World Gold Council said in its 2024 outlook published earlier this month that is forecasting continued gold-buying by central banks, which could provide additional support for gold and increase investor appetites for bullion.

However there are some warning that if inflation in the US spikes again, things could change for the yellow metal.

Han Tan, chief market analyst at Exinity said in an interview with Reuters, “Gold could be forced to unwind some of this year’s gains if an inflation resurgence forces the Fed to abandon plans for a policy pivot in 2024.”

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