Analysts expect gold prices to continue rising in the coming period due to ongoing global political and economic instability, as well as increasing geopolitical conflicts. Additionally, the recent decisions by US President Donald Trump to impose higher tariffs on imports from Mexico, Canada (currently paused for 30 days), and China have further influenced market trends.
According to global financial and banking data, gold prices are rising daily. The value of an ounce of gold is projected to reach $3,000 in the first half of 2025. Over the past months, gold has surged by more than 30%, reaching $650 per ounce since the beginning of 2024—its largest increase since 2008.
Several factors contribute to this price surge. Central banks have purchased approximately 528 tonnes of gold in the past eight months, driven by economic uncertainty and geopolitical concerns. Additionally, the price of gold is influenced by supply and demand dynamics. Increased consumer demand can drive prices higher, while economic and political crises encourage investors to seek gold as a safe-haven asset.
Interest rates also play a crucial role. When interest rates rise, gold prices may decline as other investments become more attractive. Conversely, a weaker US dollar often strengthens gold’s appeal as a store of value.
Experts suggest that gold can be a good investment depending on an individual's financial situation and goals. It serves as a hedge against economic instability, diversifies investment portfolios, and helps reduce risk. However, gold investment also comes with storage and insurance costs, requiring individuals to seek financial advice before making decisions.
The leading gold-producing nations include China, Australia, Russia, the USA, and South Africa. Among the top gold consumers, India ranks high due to cultural, economic, and religious factors, followed by China and several Arab Gulf states.
Gold remains a symbol of wealth and social status worldwide. While the US and European markets focus on gold primarily for investment and inflation protection, future price expectations remain bullish. Factors such as weak US economic data, escalating trade tensions following new US tariffs, and potential Federal Reserve decisions on interest rates will continue to shape the gold market. Traders should closely monitor global trends to make informed decisions.
The author is a Muscat-based economic analyst who previously worked for CBO and OCCI
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