Gold has been one of the best-performing assets in 2024, reaching record highs amidst a weakening global economy and relentless money printing by governments. According to forecasts from many experts, the upward trend in gold prices is expected to continue into 2025 due to several influencing factors. Below is a detailed analysis based on the latest data to predict gold prices in the U.S. at the end of 2024 and into 2025.
Gold performance in 2024
Since the beginning of 2024, gold prices have surged by more than 25%, reaching an all-time high of $2,607/ounce. This robust growth has been driven by several factors, including expectations of interest rate cuts, geopolitical instability, and the trend of central banks diversifying away from the USD. UBS states this support will likely persist as geopolitical tensions and the U.S. government’s post-election policies remain unclear. Ongoing conflicts, such as those in Ukraine and Gaza, also play a key role in maintaining high gold prices.
Gold price growth chart from the beginning of 2024 to present
One important factor is the recent months’ strong inflow of funds into gold ETFs. According to the World Gold Council, physically-backed gold ETFs have seen continuous inflows for four consecutive months, with total holdings nearing 3,182 tons as of August, the highest level since the start of 2024.
Factors impacting gold prices
Weakening U.S. dollar
The weakening of the U.S. dollar is a major driver of gold prices. When the dollar depreciates, gold becomes more attractive to investors holding other currencies. The Federal Reserve cut interest rates by 50 basis points, sparking concerns about the U.S. economy. This has increased demand for gold, pushing prices up, especially as gold has risen 27% in 2024, outpacing many stock indices.
Inflation fears and economic recession
In addition to the weakening dollar, global inflation and economic recession are prompting investors to seek refuge in gold. With major central banks, including the FED, continuously lowering interest rates to counter recession, gold remains a safe option to protect assets. Holding cash or government bonds has become less attractive in this context, and gold continues to be seen as a “haven” for investors.
Geopolitical tensions
War and geopolitical tensions are also driving up gold prices. The Russia-Ukraine conflict and instability in the Middle East have increased global uncertainty. In this environment, demand for gold has risen sharply, as it is considered a safe asset during times of turmoil.
Gold price predictions for the end of 2024
Given the current situation, analysts from many major banks believe gold prices will remain high through the end of the year. However, some analysts also warn of the possibility of short-term corrections. Ole Hansen from Saxo Bank predicts that gold prices may drop by 4-6% before continuing to rise, with a support level at $2,500/ounce. If it breaks this level, Hansen suggests gold could experience a deeper correction.
Despite concerns about a correction, Bart Melek from TD Securities maintains his forecast that gold will return to above $2,700 by the end of 2024. Melek believes that the Federal Reserve’s monetary easing policy, combined with a weakening labor market, will favor gold. Interest rates are expected to drop to 3% by 2026, increasing gold’s appeal as a haven in an environment of high inflation and negative real interest rates.
Gold price predictions for 2025
The outlook for 2025 remains highly positive, with many forecasts suggesting that gold will continue its upward trajectory. UBS has set a target of $2,700/ounce by mid-2025. According to them, long-term factors such as geopolitical instability and low interest rates will maintain upward pressure on gold prices throughout 2025.
Xanrox, an analyst from TradingView, also predicts that gold could surpass $2,800/ounce shortly, based on Elliott wave technical analysis. This forecast is based on gold’s long-term upward trend and the stability within the current price range.
Additionally, China’s economic policies, particularly its stimulus measures, could also help support gold prices in 2025. This stimulus, combined with global monetary easing policies, will continue to boost demand for safe assets like gold while reducing the value of currencies.
Impact of other precious metals
Gold and other precious metals like silver and platinum have a positive outlook for 2025. Silver saw impressive growth in 2024, reaching a 12-year high of $33 per ounce. The demand for silver in solar panel production, especially in China, will continue rising in the coming year. According to the Silver Institute, about 50% of global silver demand comes from industrial applications. Solar energy production is projected to account for 19% of total demand in 2024, equivalent to 232 million ounces.
With the growth of the renewable energy industry, silver may see even stronger gains in 2025, potentially outpacing gold in terms of growth rate. Some analysts expect the gold-silver price ratio to fall below its long-term average of 70:1, meaning silver may rise faster than gold.
Should you buy gold at the end of 2024 and 2025?
Forecasts for gold prices at the end of 2024 and 2025 indicate stable growth, with prices expected to surpass $2,700/ounce in the first half of 2025. Key factors include monetary easing policies, geopolitical instability, and safe-haven demand. While short-term corrections may occur, the long-term outlook for gold and other precious metals remains highly positive, making them an attractive investment option for investors amidst a volatile global economy.
Gold price forecast table (Estimation):
- End of 2024: $2,670 – $2,700 per ounce
- Mid-2025: $2,700 – $2,800 per ounce
Conclusion
Given the current situation and the forecast for 2025, gold remains a strong option for investors. However, market volatility and unpredictable factors such as monetary policies and geopolitical situations require investors to have a long-term strategy and exercise caution when making investment decisions.
Above, Thinksmart Insurance has provided insights into the recent gold market, factors affecting gold investment, and gold price forecasts for the end of 2024 and 2025. If you have any questions or comments, please leave us a message on Messenger or email Support@Thinksmartinsurance.com, or contact our hotline at (678) 722 3447.
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