Let’s explore why gold prices keep rising year after year. Several factors contribute to this trend, including geopolitical uncertainty, interest rate expectations, inflation concerns, and seasonal demand during festive and wedding seasons. Additionally, events like U.S. elections often influence gold prices.
As our ancestors wisely say, gold is an asset that not only retains value but often yields good returns, making it a reliable investment to buy, sell, or hold.
A little background of Gold Mining
Countries where tons of gold is mined are China, Russia and Australia. Each year around 2500 – 3000 metric tons of gold is distributed world wide. Most of its gold is sent to London via shipment. Also Bank of England holds around 400,000 bars of gold worth $260 Billion
Because of supply constraints the price of gold tends to increase, limited supply coupled with growing demands, drivers prices higher over time. U.S. Dollar Fluctuations : Gold prices are inversely related to the value of the U.S. dollar. When the dollar weakens, gold prices tend to rise as it becomes cheaper for holders of other currencies.
Current Price as of 3rd Dec, 2024
Listing down most bought as per people’s choice
| 24K Gold | Purest form of Gold, doesn’t has any mixture of alloys | Per gram – 7,793 |
| 22K Gold | Wildly used to make Jewellery. 92% pure gold, 8% alloy | Per gram – 7,145 |
| 18K Gold | 75% Gold and 25% other metals | Per gram – 5,846 |
These rates are as of 3rd Dec, 2024.
Expected rise in year 2025?
Goldman Sachs analysts, including Daan Struyven, have set a target of $3,000 per ounce for gold by December 2025. The investment bank expects this growth to be fuelled by:
- Central bank demand: Many central banks, particularly those with large US Treasury reserves, are diversifying into gold as a way to reduce reliance on the US financial system.
- US interest rate cuts: Anticipated Federal Reserve policy easing could boost gold prices further.
- Geopolitical and economic uncertainty: Concerns over US fiscal stability and global tensions could drive demand for gold as a safe-haven asset.
Source: Wall street journal, wikipedia, world gold council
