Perfect Storm Drives Gold’s Best Annual Performance in 14 Years

Gold prices soared over 26% in 2024, marking their largest annual gain since 2010. This remarkable rally, driven by robust central bank purchases, geopolitical uncertainties, and monetary easing, culminated in an all-time high of $2,790.15 per ounce on October 31.

Spot gold ended the year at $2,624.44 per ounce, up 0.7% on Tuesday, while U.S. gold futures rose 0.8% to $2,638.90 per ounce.

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XAU/USD

Gold Drivers and Outlook 2025

Central bank purchases were a key factor in gold’s strong performance, as global financial institutions sought to diversify reserves amidst geopolitical tensions and a shifting monetary landscape. Falling interest rates further supported gold as a safe-haven asset during a period of economic uncertainty.

Although gold’s momentum slowed in November due to a stronger dollar following the “Trump euphoria,” analysts believe the factors that fueled its 2024 rise will persist into 2025. Central banks are expected to continue buying at a similar pace, though potential tariffs from the Trump administration targeting countries perceived as “de-dollarizing” could weigh on flows.

XAU/USD remains well-positioned to thrive in a low-interest-rate environment, serving as a hedge against economic and geopolitical risks. A renewed rally is anticipated in 2025, bolstered by a weakening U.S. labor market, persistently high interest rates that constrain growth, and increased demand for gold ETFs.

Other Metals

Silver also had an impressive year, with prices rising 22%, the best performance since 2020, despite a slight dip to $28.83 per ounce on Tuesday. In contrast, palladium and platinum struggled, with annual losses exceeding 17% and 8%, respectively, even as palladium rose to $910.45 per ounce and platinum edged up to $904.65 per ounce on Tuesday.

While gold led the safe-haven rally in 2024, silver stood out as a strong performer, while palladium and platinum faced sector-specific challenges. The metals market remains dynamic as investors assess economic developments and policy shifts heading into 2025.

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ABOUT THE AUTHOR See More
Ignacio Teson
Ignacio Teson
Economist and Financial Analyst
Ignacio Teson is an Economist and Financial Analyst. He has more than 7 years of experience in emerging markets. He worked as an analyst and market operator at brokerage firms in Argentina and Spain.
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