The price of gold has exceeded all expectations for 2024 and has already surpassed $2,500 per ounce.

24 August 2024

2024 has been a big year for gold. The price of the precious metal has exceeded all expectations from the beginning of the year and last week marked a new high of more than $2,500 per ounce.

In January, analysts surveyed by the London Bullion Metals Association (LBMA), the independent authority on precious metals, set their outlook for 2024 at a price range of between $2,100 and $2,405. There have already been several "all-time highs" recently, and analysts expect more to come in the remainder of the year.

The milestone is that a 400 troy ounce bar now costs $1 million. People love round numbers, especially if they have six zeros. That's why the number is capturing public attention, even though most people will never actually buy what that price represents.

Either way, it represents a new way of viewing a million dollars as a physical asset: there were yachts, there were houses, and now there are gold bars. But as iconic as that format is, individual buyers tend to opt for smaller units, like kilos, 100 grams, or an ounce.

Experts consulted by Business Insider believe that rather than collectors buying bullion and coins at Costco, the real force driving gold to new highs is central banks around the world. Typically, the prospect of an interest rate cut, which is just around the corner in the US, pushes gold higher, because it reduces the attractiveness of other assets, such as Treasury bills.

"I can tell you that fear of missing out has not yet reached the bullion market, as you might expect it to be given the race between $2,000 and $2,500," Jonathan Da Silva, a trader at Kitco Metals, said in an email.

Even with gold's popularity in the United States, interest in physical gold is growing stronger among non-Western consumers, according to Stephen Flood, director and co-founder of GoldCore, a precious metals services company based in Ireland.

But experts see a flip side to gold's upward trend. "Demand is going up, but currencies are depreciating further," Flood said.

Source: BusinessInsider