According to a report from CNBC, analysts predict that the price of gold and silver will increase if the Federal Reserve cuts interest rates this year. UBS precious metals strategist Joni Teves told CNBC that they expect gold prices to hit $2,200 per ounce by the end of the year. This is due to expectations that gold will be pushed higher by a Fed easing along with a weaker dollar.
Currently, the Federal Reserve is holding short-term interest rates at a 23-year high of 5.25% to 5.5% and has not made any indication of cutting them. This decision has implications for the gold and silver markets and will also affect silver prices. Teves believes that silver will perform well and outperform gold if the Fed eases interest rates, indicating a lot of catching up to do compared to gold prices.
Gold does not directly correlate with inflation, but people may be purchasing gold for stability and a sense of security in an economy with rising inflation, a tough real-estate market, and growing distrust for banks and financial institutions.
Factors that influence the price of gold include market volatility, potential risk to investors, supply and demand, and interest rates. The spot price of gold is currently at $2,034.78, and the spot price of silver is at $22.42 per ounce as of the information presented in the article.
A report from the Silver Institute projected that global silver demand would increase to 1.2 billion ounces in 2024, indicating a potential market growth for the precious metal. The expectation is that jewelry demand will increase by 6%, while physical investment is projected to decrease by 6%. As the demand for gold and silver continues to grow, retail giant Costco reported that it sold over $100 million in gold bars in the first fiscal quarter of 2024.
Costco offers 1-ounce bars of gold from PAMP Suisse Lady Fortuna Veriscan and Rand Refinery, both made of 24-karat gold, and are available to members of the wholesale giant. The surge in gold sales is indicative of the growing interest in gold as an investment and reflects a growing trend of retail investors seeking exposure to precious metals as a hedge against inflation and other economic uncertainties. This trend provides data that indeed the price of gold and silver is set to rise, and financial investors should be quick to capture the investment opportunities in the market.
