Gold's record run faces speed bumps, but new peaks beckon
The momentum propelling gold to a record $2 135.40 per ounce on Monday may fizzle short term, due to uncertainty over the timing of US monetary easing, but wider geopolitical risks should also drive further gains towards fresh peaks, analysts said.
Safe-haven inflows driven by war in Ukraine and the Middle East, coupled with bets for a cut in US interest rates - making zero-yield gold more attractive than competing assets such as bonds and the US dollar - have driven a more than 10% rise in bullion prices.
Gold vaulted on a more dovish tilt by the Federal Reserve, but has since given up some of those gains.
"Bullish expectations have been brought forward into the first quarter of 2024 but it is not going to be a straight line to revisit the all-time peak again," said Nicky Shiels, head of metals strategy at MKS.
Steady central bank purchases led by China have also supported gold this year and this should continue next year, analysts noted.
Holdings in the largest gold-backed exchange traded fund (ETF), the SPDR Gold Shares ETF GLD.N, posted net inflows of over $1-billion in November, the most since March 2022.
However, most analysts have highlighted that prices will pull back near-term, before resuming the climb next year to target $2 150 to $2 300 per ounce.
"Gold has been known to price in monetary policy expectations prematurely over the past two years. While we expect the Fed's next move to be a rate cut, we do not expect it to materialise immediately," Standard Chartered analyst Suki Cooper said.
Comments
Research Reports
Projects
Showroom
John Thompson, the leader in energy and environmental solutions through value engineering and innovation, provides the following: design, engineer,...
VISIT SHOWROOM
Weir Minerals Europe, Middle East and Africa is a global supplier of excellent minerals solutions, including pumps, valves, hydrocyclones,...
VISIT SHOWROOM
Press Office
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation
