Market: Gold Explodes to $2,470! A Record!
On Wednesday, July 17, 2024, gold prices reached record highs in the United States stock market. The future price of the yellow metal increased by 0.1% to reach $2,470.20, while the spot price held steady at $2,466.02 an ounce. This dramatic rise is explained by several economic and geopolitical factors.
The Causes of the Rise in Gold Prices
The price of gold surged to $2,470 on the stock market, and several factors can explain this ascent. First, the actions of the BRICS: their massive and continuous purchases of gold have significantly contributed to the rise in gold prices. By accumulating gold reserves to support a potential common currency, these countries have increased global demand, pushing prices to record levels.
Next, the weakness of the US dollar. The US dollar index (DXY), which measures the strength of the dollar against a basket of foreign currencies, has slightly decreased recently, making gold more attractive to foreign investors.
Finally, investor expectations regarding a more accommodative monetary policy by the FED also played a crucial role. Anticipation of imminent interest rate cuts following Jerome Powell’s recent speech likely encouraged stock investments in gold.
Stock Market: Future Outlook for the Yellow Metal
Stock market analysts are divided on whether this increase will continue. Some predict that the price of gold will continue to rise due to the persistence of current factors. Others believe that prices could stabilize or even decrease if economic conditions improve and interest rates rise.
Therefore, forecasts for the price of gold in 2025 and beyond vary. Some experts predict a moderate increase, with prices reaching around $2,450 an ounce by the end of 2025. In the longer term, stock market projections are even more optimistic! Some analysts anticipate prices reaching between $4,600 and $6,879 an ounce by 2035.
Although gold prices reached record highs in July 2024, the future will depend largely on global economic developments and monetary policies. Investors should therefore remain vigilant and closely monitor stock market trends.
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The views, thoughts, and opinions expressed in this article belong solely to the author, and should not be taken as investment advice. Do your own research before taking any investment decisions.