Gold prices skyrocket in 2024: Will trend continue in 2025?
What's the story
Gold and silver have ended 2024 on a high note. The precious yellow metal has recorded its best annual performance in over a decade, rising over 26%.
Meanwhile, silver has witnessed its best return since 2020 with a whopping 34.4% rise this year.
The trends were driven by geopolitical tensions, central bank policies, and forecasts of lower interest rates.
Market performance
Gold, silver prices on last trading day of 2024
On the last trading day of 2024, spot gold rose slightly by 0.1% to $2,608.09 per ounce. US gold futures also rose by 0.1% to $2,620.60 per ounce.
In India, premium quality 24-carat gold was priced at ₹7,818.3 per gram—up ₹180—while standard quality 22-carat gold was priced at ₹7,168.3 per gram after rising ₹170.
The price of silver in India currently stands at ₹95,400/kg.
Market insights
Factors influencing gold, silver performance in 2024
Tim Waterer, Chief Market Analyst at KCM Trade, credited much of gold's performance to the expectation of a lower interest rate environment.
He said, "Gold enjoyed a stellar year in 2024, driven by central bank buying, policy easing, and geopolitical tensions."
Mayank Bhatnagar from FinEdge said, "The performance of gold and silver is largely driven by the geopolitical uncertainties and inflation concerns."
Future prospects
Positive investment outlook for gold, silver in 2025
Analysts predict a positive outlook for both gold and silver in 2025. The metals are expected to continue attracting investors as safe-haven assets amid ongoing central bank policies and inflation concerns.
Kyle Rodda from Capital.com said, "The fundamentals for gold remain constructive. Going into 2025, I expect the trend to remain bullish."
However, experts also advise caution due to the inherent volatility of commodity markets.
Investment advice
Experts advise caution, diversification in investment strategies
Rahul Kalantri of Mehta Equities cautioned, "Gold and silver are currently seeing strong gains, but any shifts in economic data could bring about corrections."
Bhatnagar also stressed on diversification in investment strategies. He suggested investors to concentrate on a balanced strategy in line with their financial goals, risk tolerance, and time horizon.
This advice highlights the importance of being prepared for price fluctuations and not relying solely on past performance.