World gold price skyrockets, sets new historical peak

Each ounce of gold this morning increased by more than 60 USD in just half an hour, pushing the price above 2,100 USD.

At the opening of the trading session on December 4, the world spot gold price skyrocketed by more than 60 USD, approaching 2,140 USD per ounce. Currently, the price has retreated to 2,095 USD.

This is the second consecutive session that the price of precious metals has set a new historical peak. On December 1, the price closed at 2,071 USD. During the session, gold reached 2,075 USD, surpassing the old record set in 2020.

World gold prices skyrocketed at the opening session on the morning of December 4.

The global gold rush shows no signs of cooling down anytime soon. Prices are forecast to hit new highs next year and remain above the $2,000 mark, due to geopolitical uncertainty, a potentially weaker US dollar and lower global interest rates.

Gold prices have risen for two consecutive months, as conflict in the Middle East boosted demand for safe-haven assets. Forecasts of lower interest rates also supported the market.

"We believe the key factors supporting gold prices in 2024 will be Fed rate cuts, a weaker US dollar and heightened geopolitical tensions," said BMI, a market research arm of Fitch Solutions. Gold is often favored during times of economic and social turmoil because of its ability to store value.

Bart Melek, head of commodity strategy at TD Securities, forecasts gold prices to average $2,100 in the second quarter of next year. He believes that strong central bank buying will underpin gold's rally.

The latest survey by the World Gold Council (WGC) shows that 24% of global central banks plan to increase their gold reserves in the next 12 months. The reason is that they are increasingly skeptical about the role of the US dollar as a reserve asset.

A shift in the Fed’s monetary policy in 2024 could also impact gold prices, Melek said. Lower interest rates would push down the dollar, making gold more attractive to non-U.S. buyers.

On November 29, Fed Board of Governors member Christopher Waller predicted that the Fed could ease policy if inflation continues to cool in the next 3-5 months. "The $2,100 mark is increasingly likely in the next quarter, if not sooner," Nicky Shiels, Director of Precious Metals Strategy at MKS PAMP, predicted on December 3.

Ha Thu (according to CNBC, Kitco)

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