Gold supported in 2024 by bets on monetary policy easing, Mid-East war risks: Reuters poll

By Harshit Verma

(Reuters) – Gold prices will rise in 2024 from this year’s average on bets that global central banks would start monetary policy easing and after the Middle East conflict provided a boost to gold’s safe-haven rally above $2,000, a Reuters poll showed on Wednesday.

The poll of 30 analysts and traders conducted in October returned a median forecast for gold at $1,986.5 a troy ounce for 2024, up from $1,925 expected this year.

Respondents have slightly lowered forecasts since July, when a similar poll predicted gold to average $1,988 per ounce in 2024 and $1,944.5 in 2023.

“Heightened geopolitical tension in the Middle East will continue to underpin gold in the short term, although we do not envisage a sustained challenge above $2,000 per ounce until Western central banks, particularly the (U.S.) Federal Reserve adopt a more accommodative stance,” Fastmarkets analyst James Moore said.

While most economists still say the Fed will cut by mid-2024, the latest poll shows just 55% backing that scenario compared with over 70% last month.

Gold, used to preserve wealth in times of economic and political uncertainty, rose over 7% in October as the Israel-Hamas war boosted safe-haven bets. The metal rose above the key psychological $2,000 level for the first time since May.

“Gold has had a long history of being a geopolitical hedging instrument and has performed true to its reputation,” said Nitesh Shah, commodity strategist at WisdomTree.

Carsten Menke from Julius Baer said “a return towards record-highs should only be possible in case of a severe slowdown of the U.S. economy, leading into a longer-lasting and broader-based recession.”

For silver the poll forecast median prices of $24.85 per ounce in 2024 and $23.20 in 2023, down slightly from the previous poll.

Silver, which shed over 2% in the third quarter, tracked bullion’s safe-haven fleet with an over 3% gain in October.

“We expect it to outperform gold in 2024 on the back of strong demand growth from the photovoltaic sector,” said Capital Economics analyst Caroline Bain.