Paul Dietrich, chief investment strategist at B. Riley Wealth Portfolio Advisors, told “The Craman Countdown” that gold is going to do very well.
Buying Gold The total amount of new interest rate hikes by global central banks in 2023 will be the second-largest on an annual basis on record, according to a June report from the World Gold Council.
Central banks added 1,037 tonnes of gold in 2023, just shy of 2022’s record purchases of 1,082 tonnes, according to the 2024 Central Bank Gold Reserve Survey.
The survey also found that 29% of central bank respondents plan to increase their gold reserves, the highest level since the committee began its annual survey in 2018. More than two-thirds of respondents, 68%, said gold reserves would remain unchanged, while 3% said they expected to reduce gold reserves.
The central bank’s planned purchases are driven primarily by a desire to rebalance its portfolio to strategically desirable levels of domestic gold production and holdings. Financial Market Concerns This is also a factor.
ETFs that invest in gold, silver, copper, and all sorts of other assets
Central banks’ purchases of additional gold reserves in 2023 were the second-largest on record after 2022, according to the World Gold Association. (Arne Dedert/dpa/AFP via Getty Images)
The most important factors central banks considered in deciding to hold gold reserves were its function as an inflation hedge and long-term store of value (42% very important, 46% somewhat important) and its performance in times of crisis (47% very important, 35% somewhat important).
According to the survey, the least important factor in gold portfolio decision-making is gold serving as a component of a de-dollarisation policy, with 68% saying it was not a relevant factor and 21% saying it was only a minor consideration.
Why gold ETFs are a good alternative to bonds as inflation continues
The World Gold Association said 29% of central banks plan to increase their gold reserves this year, the highest record since the survey began in 2018. (Nathan Howard/Bloomberg/Getty Images/File)
Also, International Monetary System 58% of respondents said it was not relevant and 26% said it was slightly relevant.
Analysts at Bank of America recently predicted that gold prices could surge to $3,000 an ounce over the next 12 to 18 months, but acknowledged that current market conditions make such a big surge unlikely.
Costco’s gold and silver sales “seem to have increased quite a bit.”
As of market close on Friday, gold futures are up about 12.7% year to date and 21.1% year-over-year. (Chris Ratcliffe/Bloomberg via Getty Images)
of Bank of America The analysis suggests that non-commercial demand would drive a rise to $3,000, which would require an increase of about 28% from Friday’s closing prices of $2,326.47 an ounce for spot gold and $2,339.60 for gold futures.
The government has pointed out the possibility of lowering interest rates. Federal Reserve This could spark a rise in gold prices as investors move into gold ETFs backed by physical reserves.
“Continued gold purchases by central banks will also be important and any move to reduce the share of the US dollar in foreign exchange portfolios is likely to encourage increased gold purchases by central banks,” the analysts said.
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Gold futures were up about 12.7% year-to-date as of Friday’s market close and 21.1% year-over-year.
Reuters contributed to this report.
