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This surge in interest has good reasons. Gold has long been recognized as a hedge against inflation. Given that inflation has surpassed the Federal Reserve’s 2% target, many discerning consumers are actively seeking the hedge qualities of gold. Furthermore, gold serves as a portfolio diversifier and, in general, a stable hedge of value over the long term.
The heightened interest in gold investment over the past year has been substantial. Gold prices witnessed a notable surge, reaching their highest levels in over a year. By the end of November, prices are exceeding $2,000. The question is, will prices surpass this rate in 2024? Experts weigh in on this matter.
Rising Inflation
One of the big reasons gold has become popular and pricier lately is inflation. Despite the Federal Reserve’s multiple interest rate hikes aimed at curbing inflation, the central bank remains distant from achieving its 2% target. A projection from WisdomTree Investments suggests that this situation is likely to persist. 
According to WisdomTree’s forecast, the beginning of 2024 is expected to see a 3.1% inflation rate, with an ensuing decline to a 2.60% rate by the third quarter. This sustained level of elevated inflation is anticipated to drive increased demand for gold, consequently influencing upward pressure on gold prices. Investors are closely monitoring these trends as they evaluate the potential impact on their portfolios in the coming quarters.
“When inflation rates rise, gold prices often increase as well,” reports Gold IRA Guide analyst Liam Hunt. “If current trends of economic uncertainty and inflationary pressures continue, there could be upward pressure on gold prices. In 1980, gold prices reached a then-record $800 per ounce following years of generationally high inflation over the preceding decade.”
Nitesh Shah, head of commodities and macroeconomic research at WisdomTree explains, “In other scenarios of the world where economic conditions deteriorate faster there is greater demand for defensive assets, we could see gold prices rising even further.”
Geopolitical Tensions
Monitoring inflation and geopolitical developments will be crucial for those closely tracking gold prices in the coming year. “Periodically, geopolitical risks, and a flight to safety drive up the demand for gold,” Shah says. “Recently, the Israel-Hamas conflict has driven up the geopolitical premium in gold.” Following the Middle East conflict between Israel and Gaza began in October, gold prices took off, reaching points unseen since mid-2022.
“Fears that an uncontained, regional war could disrupt global markets and supply chains triggered capital flight into gold and away from speculative assets such as high-risk stocks,” Hunt states. “Gold is often seen as a safe-haven asset. In times of economic uncertainty or market volatility, investors turn to gold, putting upward price pressure on the yellow metal.”
Current economic conditions and political tensions contribute to experts believing that gold prices are going to rise in 2024. As an increasing number of consumers actively search for a secure haven to preserve their wealth, WisdomTree predicts a continuous rise in gold prices throughout the year, peaking at $2090 per ounce by the third quarter. The firm claims that prices could reach $2,300 per ounce.
There’s no way to tell for certain, but signs seem to point to a rise in gold prices in the coming year. If you’re considering investing in gold, that means you may want to act quickly, before prices rise further. At Reagan Gold Group, you can speak with a commodities specialist about physical gold or silver, or a gold or silver backed IRA, to hedge your portfolio. Book a FREE consultation to get started. Contact Reagan Gold Group today and find out more about precious metal investments. When it comes to your assets, there’s no better time than the present to take action.
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