Gold price nears $3,000 milestone

After several months of rising prices, gold could reach $3,000 by the end of 2024 or sooner.

According to GoldPrice.org, the price of an ounce has risen 45.93 percent over the past year and 6.58 percent over the past 30 days. As of October 3, the price is at $2,642.45 and experts expect it to rise to a record $3,000 before the end of 2024.

“In March 2024, gold reached $2,070 and although there have been dips and declines over the past six months, gold continues to rise,” said Nick Fulton, managing partner at
USA Pawn, tells Newsweek. “When we saw $2,600 an ounce of gold, I thought it would be $2,800 at the end of the year.

An increase in gold prices can be attributed to several factors; These include recently reduced interest rates from the Federal Reserve; new attraction for investors; and war in the Middle East, as gold is considered a safe investment, especially in times of geopolitical conflicts.

A rise in gold prices at a time of significant geopolitical turmoil is no surprise, said Michael Martin, vice president of market strategy at TradingBlock Newsweek.

“Ongoing conflicts such as the war in Ukraine and tensions in the Middle East have driven investors to safe havens such as gold,” Martin said. “Global tensions have historically been accompanied by increases in gold prices. During the Soviet invasion of Afghanistan in 1979, for example, the value of gold more than doubled.”

Matthew Jones, precious metals analyst at Solomon Global, said Newsweek that gold prices could reach $3,000 if Israel retaliates against Iran. In response to Israel's killing of Hamas and Hezbollah leaders, Tehran fired around 180 rockets at the Israelis on Tuesday, October 1.

“In view of the ballistic missiles fired at Israel yesterday, it now appears that the feared escalation into a regional war has unfortunately occurred. “Israel is committed to further retaliation against both Iran’s oil refineries and nuclear facilities,” Jones said. “The moment Israel fires its missiles, the price of gold will reach and exceed $3,000.”

Aside from the ongoing war in the Middle East, prices are experiencing an upward trend thanks to new investors and a surge in Eastern central banks buying gold.

“As a brick-and-mortar seller, we see a lot of first-time buyers. With gold increasing in value by 25 percent in the last six months, it is attracting new investors,” Fulton said. He also pointed to an increase in purchases from central banks in China and India.

According to a Reuters report, the People's Bank of China (PBOC) had purchased gold for 18 consecutive months and the value of its gold reserves rose to $182.98 billion at the end of August, compared to $176.64 billion at the end of July.

“We don’t expect this to subside any time soon,” said Luciano Duque, chief investment officer at C3 Bullion Newsweek. “On the contrary, as large banks increase their gold holdings, as they have done over the past two years, we can expect smaller banks to follow suit, and for investors this is a growing wave.”

Additionally, some investors have avoided selling gold, “which has further limited supply and pushed the price higher,” Jones said. “With inflation easing but still present and the potential for further rate cuts, gold’s outlook remains positive for the remainder of 2024.”

“We believe that after reaching this mark ($3,000), there is no chance of a decline in the short and medium term,” Duque said. “We believe gold prices below $2,000 could be something we will likely never see again in our lifetime.”

Given the unlikely resolution of the ongoing conflicts in the Middle East and Ukraine, a long-term decline in gold prices is not on the agenda.

“The problems in the Middle East will continue to drive gold prices as any disruption to production and oil transportation will act like a sledgehammer to return inflation and gold peaks during times of high inflation,” Jones said.