Gold futures (GC=F) jumped to a new high of $2,706 per ounce during Thursday’s session, giving credence to bulls who claim the precious metal rally isn’t over.
Spot gold also rose to a new high north of $2,690 per ounce.
Year-to-date, gold is up more than 30%, beating out the S&P 500’s gain of 22% and making it one of the best performing commodities of 2024.
Central banks have boosted their reserves of gold in recent years, with buying in the first quarter of this year touching a record high compared to the same period last year.
The Federal Reserve’s recent pivot towards lower interest rates has helped accelerate the commodity’s gain in recent months given it is a non-yield bearing asset.
“On the investor side, demand from the private investors here in the US specifically is no where near the capacity,” said Alex Ebkarian, COO and co-founder of Allegiance Gold.
Goldman Sachs analysts recently pointed out in a note that the gold market hasn’t fully priced in increased investments into Western physically gold backed ETFs, a move which tends to be gradual.
The firm raised its price target on the precious metal from $2,700 to $2,900 per troy ounce for early 2025, noting its economists now look for faster declines in short-term interest rates in Western nations and China.
Goldman analysts said the purchases of gold by central banks will remain “structurally elevated.”
Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre.
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