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Gold passes $2,700 to hit new all-time high "and $3000 per ounce is now a real possibility"

Journalist: John Choong (Head of Markets and Research), Newspage

ended 21. October 2024

Not for the first time this year, gold has hit another all-time high. The yellow metal has climbed past $2,700 per ounce as global demand for the safe-haven asset along with expectations of further interest rate cuts from major central banks grows.

This comes on the back of the European Central Bank cutting rates for the third time this year. The commodity has also found further bullishness from tensions in the Middle East. Wes Wilkes, CEO at Net-Worth NTWRK, said: "After a significant 13-year consolidation period, the breakout in gold is set to push higher. With the current trend alongside the upcoming US election uncertainty and ongoing geopolitical tensions, we can expect the $3,000 gold level to be breached with a high degree of certainty and it could even happen before we close the door on 2024."

Prem Raja, Head of Trading Floor at Currencies 4 You, added: “The strength in precious metals and gold in particular this year has been phenomenal, with factors such as lower interest rates, the U.S election and the current Middle East tensions seeing gold prices reach new highs of $2700. I personally believe gold is still on an upward trend and $3000 per ounce is now a real possibility. In the short term I do think a small correction is due, this is something we will probably see from November into December, and then it will be worth bidding again going into 2025. It's still a bull market for precious metals and pullbacks are healthy.”

Meanwhile, Anita Wright, Independent Financial Adviser at Bolton James, said the gold rush has only just started: "Although gold has reached a new all-time high, the real action in gold prices hasn't started yet, and there is still much upside potential. Many key drivers that historically push gold prices higher are not yet fully in play. For instance, real interest rates remain positive, and the U.S. dollar has retained some strength. Interest rate cuts have only just begun, and we have not yet seen the significant negative real yields that often fuel gold's rise. In addition, geopolitical factors, such as sanctions on Russia, are pushing many BRICS countries to reduce their dependency on the dollar, which could lead to dollar weakness in the near future—a key driver for gold. With the fiat currency system under strain and a potential "race to the bottom" for many currencies, gold could continue its upward momentum. It's possible that gold could reach the $3,000–$3,200 range before seeing another pause."

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6 responses from the Newspage community

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Editor
Gabriel McKeown
Head of Macroeconomics at The Sad Rabbit Newsletter
As global tensions start to boil, escalating geopolitical fears have sparked a modern-day gold rush, with investors scrambling for this time-tested safe haven. With gold's siren song growing louder, prices have soared to an all-time high, soaring past the symbolic $2,700 level. After the Fed’s rate cut bonanza firing the starting gun on a new easing cycle, gold has continued off to the races, and there appears to be plenty of room to run. Amidst a landscape of international unrest, this might be the catalyst for gold to reach $3,000 soon. However, despite the longer-term bull case remaining intact, gold prices may be susceptible to intermittent pullbacks amid such a rapid ascent. With a succession of record highs, the gold market may become overheated and vulnerable to profit-taking, so investors should prepare for short-term volatility as bullion prices reach for the stars. In a world fraught with uncertainty, savvy investors are driving the precious metal to record levels.
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Anita Wright
Independent Financial Adviser at Bolton James
Although gold has reached a new all-time high, the real action in gold prices hasn't started yet, and there is still much upside potential. Many key drivers that historically push gold prices higher are not yet fully in play. For instance, real interest rates remain positive, and the U.S. dollar has retained some strength. Interest rate cuts have only just begun, and we have not yet seen the significant negative real yields that often fuel gold's rise. In addition, geopolitical factors, such as sanctions on Russia, are pushing many BRICS countries to reduce their dependency on the dollar, which could lead to dollar weakness in the near future—a key driver for gold. With the fiat currency system under strain and a potential "race to the bottom" for many currencies, gold could continue its upward momentum. It's possible that gold could reach the $3,000–$3,200 range before seeing another pause.
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Platinum
Prem Raja
Head of Trading Floor at Currencies 4 You
The strength in precious metals and gold in particular this year has been phenomenal, with factors such as lower interest rates, the U.S election and the current Middle East tensions seeing gold prices reach new highs of $2700. I personally believe gold is still on an upward trend and $3000 per ounce is now a real possibility. In the short term I do think a small correction is due, this is something we will probably see from November into December, and then it will be worth bidding again going into 2025. It's still a bull market for precious metals and pullbacks are healthy.
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Editor
Riz Malik
Independent Financial Adviser at R3 Wealth
Although this is a new high, gold will probably continue to appreciate given the current economic backdrop. The Middle East is of growing concern and the US election is leading investors into the arms of the classic safe haven.
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Platinum
Wes Wilkes
CEO at IronMarket Wealth
After a significant 13-year consolidation period, the breakout in gold is set to push higher. With the current trend alongside the upcoming US election uncertainty and ongoing geopolitical tensions, we can expect the $3,000 gold level to be breached with a high degree of certainty and it could even happen before we close the door on 2024.
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Mark Scott
Director and IFA at Positive Advisers Ltd
Gold can be important for short-term investors or those who are speculating rather than investing for the long term. It's important to remember that long-term investors should not change their long-term investment plans based on short-term news or noise.