Gold became expensive with a tremendous increase of 26.6 percent in the year 2024. If we look at international trends, last year the S&P 500 showed a growth of 23 percent. Gold touched an all-time record of $2,790 an ounce on Halloween on October 31 and at the time of writing it was trading at $2,642. According to the news of DailyMail, financial experts believe that sell-off in stocks, inflation or geopolitical shocks could bring another boom for gold in 2025. According to Adrian Ash, research director at BullionVault, the price increase achieved in 2024 exceeded financial analysts’ forecasts.
Gold price increased much more than expected
According to the news, the price of gold has increased by an average of 23 percent on an annual basis this year, to an average of $2,386 per troy ounce, while professional analysts had expected an increase of only 6.1 percent. Ash says there are many benefits of holding gold in a balanced portfolio. The precious metal is a store of wealth and a hedge against inflation, a useful way to diversify and a safe haven asset during financial and political turmoil. However, you need to have a clear vision, as gold does not generate any income and the price can be volatile.
What do local experts say
Yogesh Singhal, Chairman of Delhi-based All Bullion and Jewelers Association, says that we are expecting a 10 percent correction in the price of gold in the coming time. However, this will largely depend on geopolitical tensions and the trend of the international market. On a question about the demand for gold in India, he said that the demand is likely to be less this year compared to last year because the prices are high. For investors, Singhal has said that they should buy gold in every fall.
What affects the price of gold?
Key to this are steps taken by the US Federal Reserve, the world’s most powerful central bank. Rate cuts, or just the prospect of them, make gold more attractive to investors because they weaken the dollar and could fuel inflation. Many people like to keep gold and have a lot of money. Over the past few years, there has been much speculation that secret trading activity has also influenced the price of gold. The invasion of Ukraine led to sanctions against Russia, which has the world’s second-largest gold mining industry.
A stronger dollar makes gold more expensive and this can discourage all types of buyers and weigh on the price. Demand for coins, bars and jewellery, which may be seasonal. For example, the festival of Diwali is a popular time to buy gold jewelery in India, and the Lunar New Year in China is also popular for physical gold of all types. It also affects sleep.
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