"The current surge in gold prices is driven by a trifecta of global economic forces"

It's been quite some gold rush in 2024, although 2023 wasn't bad for gold either. As it hits new all-time highs again, there are three key drivers that could mean it could go further before year end. Falling rates globally, huge bouts of central bank purchases and continual geopolitical tensions are all strong tailwinds for the shiny metal to push on through to further highs in 2024.

The recent surge in gold prices, reaching a new all-time high, is driven by several factors, notably the U.S. Federal Reserve's expected monetary policy changes. The market anticipates a September rate cut, possibly exceeding 0.25%, which is typically bullish for gold. Remarkably, gold has risen over 20% this year despite high interest rates. Additionally, central banks, particularly in BRICS countries like Russia, China, India, and Turkey, have dramatically increased their gold purchases, reflecting growing mistrust in the U.S. dollar. This trend is further fuelled by the BRIC countries accelerating their efforts towards de-dollarization. Commodities that were traditionally traded in dollars are increasingly being traded in local currencies or gold, which contributes to a weakening dollar. The combination of lower interest rates, a weaker dollar, and strong central bank demand creates a highly favourable environment for gold and it is plausible that gold could rise further.