According to a poll of Investing.com readers, Investing.com is expected to trade between $2,600 and $3,000 by the end of the year.
Of the 2,330 votes, 49.9% of respondents said they expect the yellow metal’s price to be within that range by the end of 2024. Meanwhile, 32.3% believe the price will be above $3,000 and 17.9% expect it to be below $2,600.
At 6:57 AM ET (10:57 GMT) on Thursday, spot gold rose 0.7% to $2,674.56 per ounce, while December expiration rose 0.5% to $2,697.60 per ounce.
Underlying the increase is a massive 50 basis point rate cut by the Federal Reserve last week, as well as bets that the central bank will make further cuts this year. Lower interest rates are a good sign for gold as they reduce the opportunity cost of investing in non-yielding assets.
Analysts at UBS have increased their gold price forecasts, saying they now predict gold will reach $2,750 per ounce by the end of 2024, up from the previous forecast of $2,600.
However, Bank of America analysts pointed out that even though gold prices are well above their 200-day moving average, returns have historically been “flat 1-6 months after trading at such extremes.”
“Gold investors are also giving a discount of 150-200 [basis points] of interest rate cuts according to our estimate. If Fed cuts are slower than expected, the pace of gold appreciation could also slow,” Bank of America analysts wrote.
“Nevertheless, support for prices is clear.”
Investors are now focused on an upcoming speech from Fed Chairman Jerome Powell on Thursday, while key US economic data also emerged.
Powell will deliver pre-recorded remarks at the US Treasury Market Conference in New York at 9:20 a.m., according to the Fed’s website.
After last week’s excessive rate cut, Powell said the move was part of a “recalibration” of policies aimed at protecting the U.S. labor market while sustainably returning inflation to the Fed’s 2% target.
Several other policymakers have defended the big pullback this week, including Fed Governor Adriana Kugler, who said Wednesday that the rate-setting Federal Open Market Committee must “balance its focus” between suppressing price pressures and avoiding “pain” in the broader economy. .
But Fed officials are not unanimous in their support for the size of the cut. Fed Governor Michelle Bowman, who voted to cut borrowing costs by a more traditional 25 basis points, has said she remains concerned about lingering inflation risks.
