Gold expected to hold above $2000 in 2024

Gold is trading around $2035 per ounce at the time of writing. It is worth mentioning that the precious metal’s price previously surged more than 20% to a record high of $2135 in 2023.

Economists and experts predict that gold’s upside will soon reach a ceiling. It is generally predicted that the average price of gold would exceed $2000 by 2024. Although experts believe that gold will continue to rise, the most recent price surge seems excessive.

Real rates will rise by 50–100 basis points if inflation declines and rates remain steady until the first half of 2024. This will be detrimental to gold investments. As a result, analysts think that gold’s potential is limited in the foreseeable future.

There are three key factors determining the long-term optimistic outlook for gold: Initially, interest rates will be lowered by the Fed, which will lower the opportunity cost of holding gold that doesn’t yield returns. Second, risks related to the economy, politics, and geopolitics are predicted to remain high in 2024.

The approaching US elections will make policy more unpredictable, and the likelihood of slower economic development may persuade investors to add gold to their portfolios in order to diversify their holdings.

Third, even after two years of robust purchases of gold, central banks continue to make purchases. Although there may be an upside risk to this estimate, economists put central bank purchases in the 800-850t area.