Gold hit another record high on Wednesday, with Bank of America and Citi forecasting it may exceed $3,000 in the near future.
While stock markets are achieving new highs, gold’s recent performance is even more remarkable. Since the start of the year, gold’s price has surged by 26.1%, outpacing all major global indices.
On Wednesday, the price of gold peaked at $2,627.20 per ounce, according to Investing.com, before retreating following the U.S. Federal Reserve’s interest rate cut announcement.
“Gold had already seen substantial gains before the announcement, so the subsequent mixed reaction might reflect a classic ‘buy the rumor, sell the news’ scenario,” notes Ricardo Evangelista of ActivTrades. “In the coming days, gold prices may regain strength as traders consider the possibility of further short-term rate cuts, as suggested by Fed Chair Jerome Powell,” he adds.
In April, Citi forecast that gold could hit $3,000 within the next six to eighteen months, driven by strong physical demand and its role as a hedge against geopolitical risks, according to CNBC.
“The yellow metal is likely to continue its ascent towards the $3,000 mark,” says Naeem Aslam, an analyst at Zaye Capital. He warns that any forthcoming economic data weaknesses could further boost gold prices.
In a recent note, Bank of America projected that gold will reach $3,000 per ounce over the next year.
“Gold is one of our top commodities, with its price driven higher by purchases from central banks, Chinese investors, and increasingly Western buyers, supported by various macroeconomic factors, including anticipated U.S. interest rate cuts,” the bank stated.
However, not all analysts share this optimism. UBS predicts a price of $2,700 per ounce by mid-2025, suggesting that geopolitical tensions following the U.S. presidential election in November will sustain gold’s appeal.
