What’s The Gold Prices Forecast In The Second Half Of 2024?

Gold prices will never likely stop being a topic for conversation among traders as they consider the precious metal a “safe haven” asset. As central banks were quite careful when it came to cutting interest rates in the first half of 2024, gold prices have gained ground as investors and traders put an effort to diversify their portfolios.

In this article you will be able to learn valuable insights and forecasts regarding gold that may help you navigate the world of gold trading.

What’s Up With Gold?

2024 has been a good year for gold so far as the precious metal prices have risen by 15% and remain close to historical highs. Conflicts in Ukraine and the Middle East as well as gold purchases by various central banks across the world have played a role in gold prices’ surge. The precious metal saw its third straight quarter of value rise, recording an upward trajectory such as the one marked during the Covid-19 pandemic era.

A World Gold Council survey, published on June 18th 2024, said that “29% of central banks respondents intend to increase their gold reserves in the next twelve months, the highest level we have observed since we began this survey in 2018. The planned purchases are chiefly motivated by a desire to rebalance to a more preferred strategic level of gold holdings, domestic gold production, and financial market concerns including higher crisis risks and rising inflation.”

UBS Survey Shows Will For More Exposure To Gold

The UBS Asset Management survey of 40 leading central banks showed that among respondents, 24% had increased their gold exposure in the past year and 30% plan to do so in the coming year, although they also plan to invest more in bonds.

Economists at UBS Asset Management noted that "the recent political decision to use profits from central banks of Russia’s frozen assets to finance Ukraine raises further the risk that FX reserves are no longer seen as a safe haven for central banks. Gold, an asset held by central banks largely for historical reasons linked to the time when it was a pillar of the global financial system, risks being brought back to life by ongoing geopolitical trends,” they added.

ING Says Rate Cut Forecasts Boost Gold

Economists at ING suggest that hopes over rate cuts implemented by the Federal Reserve boost gold prices. In a report published on July 8th, the Dutch bank’s metal analysts said: “Optimism about US interest rate cuts as more economic data supports the case for a Federal Reserve pivot has also supported the outlook for gold this year. Lower borrowing costs are generally supportive of non-interest-bearing gold.

The report also notes that “the war in Ukraine and the Middle East and tensions between the US and China suggest that safe-haven demand will continue to support gold prices in the short to medium term. The US presidential election in November and the long-awaited US Fed rate cut will also continue to add to gold's upward momentum through to the end of the year, in our view. We see gold averaging $2,300 in the third quarter and prices peaking in the fourth at $2,350/oz making for an annual average of $2,255/oz.”

TDS: Interest In Gold Revived

Metal market analysts at TDS said that raising chances over a September rate cut by the Fed support gold prices. In their note to investors released on July 11th they note: “Below expected inflation data is compounding the precious metals rally after softer employment data had already bolstered expectations of a September start to the Federal Reserve (Fed) cutting cycle. In this sense, a key macro cohort that has been on the sidelines thus far is increasingly likely to regain interest in Gold.”

The TDS report also refers to the growing number of newly opened ETF positions, saying that “indeed, the first evidence of renewed interest is starting to show as ETF positions continue to rise in July, after June saw the first monthly increase since May 2023. Furthermore, while Chinese Gold reserves were flat for a second consecutive month, top traders on the Shanghai Futures Exchange (SHFE) have added back to their net positions, highlighting Asian demand is set to remain strong.”

ABN AMRO Cautious Over Gold Prices

ABN AMRO, the third largest bank in the Netherlands, says that investors should be cautious regarding the precious metal’s prices, adding that gold seems to have been losing some of its momentum.

“Gold prices this year were supported by: investors buying the Yellow Metal on the futures markets and in other forms; central banks forming gold reserves; technical picture. The rally has lost momentum since the high of $2,450 that was set on 20 May 2024,” is noted in the Dutch bank’s report.

The bank’s economists forecast gold prices to come in at $2,000 per ounce by the end of the year, noting: “We remain cautious for the outlook for Gold prices: the trend in Gold prices is positive, but the momentum is declining; it is unusual for Gold prices to have positive relationships with the US dollar and 5yr and 10yr US real yields; there is no shortage in physical Gold.”

Trading Gold With Admirals

A trading account with Admirals allows our traders to trade gold, silver, copper and other metals that could help them diversify their strategies. An Admirals trading account also gives you access to a wide array of financial instruments including CFDs on shares, bonds, currency pairs and so much more.

Upgrading trading skills should be one of the main goals of every beginner trader. As lack of experience is quite hard to compensate for, beginner traders should expand their trading knowledge by studying educational materials that sometimes come without charge from brokers. Traders can find online access to e-books, webinars, articles, how-to guides that can help them learn more about how trading works and what they should take into consideration before building a trading plan.

As with trading any financial instrument, risk management tools should be used by every trader, even more when beginner traders are involved. Traders who just start their journey in the trading world should learn how to use risk management tools such as the stop-loss order and the take-profit order. While these tools can’t eliminate risks, they can surely mitigate them if used properly. Therefore, risk management tools should be a part of every beginner trader’s strategy.

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This material does not contain and should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments. Please note that such trading analysis is not a reliable indicator for any current or future performance, as circumstances may change over time. Before making any investment decisions, you should seek advice from independent financial advisors to ensure you understand the risks.