JPMorgan has underlined its commitment to gold, saying it holds a bullish view and expects the precious metal to perform well for at least the next 18 months. The bank has updated its projections for the precious metal as a result and is now calling for a new all-time high in the second half of the year, followed by new records in 2025.
Analysts say they expect to see the bulls reach £1,703 ($2,175) in the fourth quarter of 2024. Prices will then rise again to an average of £1,801 ($2,300) around June of next year.
A number of driving forces are expected to push gold to all-time prices highs over the course of the year. Chief amongst them will be Federal Reserve action favouring the bulls, ongoing central bank buying, heightened investment demand and continuing geopolitical and economic uncertainty.
JPMorgan’s head of base and precious metals strategy, Gregory Shearer explained, “The Fed cutting cycle and falling U.S. real yields will once again become the mono-driver behind gold’s breakout rally later in 2024. Gold’s inverse relationship to real yields has historically been weaker over Fed hiking cycles, before strengthening again as yields fall over a transition into a cutting cycle.”
He added, “Continued robust central bank purchases, along with boosted physical demand on price dips will likely remain a significant support to prices over the final twists and turns of the Fed cycle. There is still scope for boosted reserves at some central banks as institutions look to diversify reserve assets, so purchasing is likely to remain structurally elevated compared with the late 2010s.”
With price increases forecast well into next year, there’s no time to wait. Buy gold now.
