Gold price surge eyed

BULLS: EXPECT PRECIOUS MINERAL TO HOVER ABOVE $3,000 NEXT YEAR

- Adriaan Kruger

The World Gold Council predicts the gold price to increase next year, establishing a new floor of well above $2,400 per ounce. The organisation, along with other pundits, says global uncertainties remain worrisome enough to fuel investment.

"Gold is poised for its best annual performance in more than a decade," the World Gold Council said of the 28% increase through last month, even though the price fell back to below $2,600 during the past two weeks.

"Central bank and investor buying have offset a notable deceleration in consumer demand. Asian investors have been a near-constant presence, while lower yields and a weakening dollar in the third quarter fuelled Western investment flows.

"However, it is gold's role as a hedge amid rising market volatility and geopolitical risk that most likely explains its remarkable performance (this year)," the organisation said in a recent report.

"As we look forward, all eyes are focused on what (incoming US president Donald) Trump's second term may mean for the global economy. Thrill-seeking investors may benefit from an early wave of risk-on flows, but potential trade wars and inflationary forces may spill over into an expected subpar economic growth.

"The market consensus of key macro variables such as GDP, yields and inflation - if taken at face value - suggests positive, but much more modest growth for gold in 2025.