Gold and silver top global market gains in 9 months

Both gold and silver have strengthened their performance during the first nine months of this year, due to a package of factors that pushed the yellow metal to record unprecedented historical peaks, in addition to silver contract prices.

According to the Anatolia Agency, a survey based on historical data for gold contracts shows that yellow metal prices increased by 27.5% during the first nine months of this year, compared to the figures at the end of 2023.

Spot gold contracts reached $2,659 per ounce at the end of the session on September 30, a price close to the historical peak recorded at the end of the session on September 26, which amounted to $2,682 per ounce.

The rise in gold prices comes primarily amid the continued rush of global central banks to buy the precious metal, amid fears of accelerating inflation and geopolitical tensions.

Also, the US Federal Reserve’s announcement of the start of a monetary easing journey or reducing interest rates has supported gold contracts that are going against interest rates under normal circumstances.

On September 18, the US Federal Reserve announced a 50 basis point cut in interest rates to a range of 4.75% – 5%, with two meetings remaining before 2025, amid expectations of at least one additional cut.

In total, the world’s central banks bought 483 tons of gold in the first half of 2024, the highest level ever in that period, according to data from the World Gold Council.

Central banks around the world were stockpiling their gold reserves at record levels in 2024 in an effort to store valuable assets.

The first half 2024 purchase figure is 5 percent higher than the previous record of 460 tons, which was recorded in the first half of 2023.

Beijing’s appetite for gold has also continued since the beginning of 2023, as the People’s Bank of China (the central bank) continued its purchases for the eighteenth consecutive month in April, raising its total gold holdings to 2264.3 tons.

On Monday, Goldman Sachs raised its gold price forecast for early 2025 to $2,900 per ounce from $2,700, citing faster declines in short-term interest rates in the West and China and strong buying by central banks.

Goldman Sachs said in a research note: “We reiterate our long-term gold buy recommendation, due to the gradual support from lower global interest rates, rising demand from central banks, and the benefits of hedging in gold against geopolitical, financial and recessionary risks.”

As for silver, its prices rose during the first nine months of this year by more than 37%, compared to the end-2023 figures, recording $33.5 per ounce. On September 24, 2024, silver confirmed its ability to reach the global investment banks’ price target of $34.70, amid expectations that it will reach $50 by the first half of 2025.

According to a research note by the investment firm InvestingHaven, the price of $34.70 per ounce is a no-brainer target in 2024.

It said: “Our second upside target is $37.70… then we expect a rapid rise to $48-50, to be reached in the period from April to June 2025.”

As for Wall Street, the S&P 500 index rose by 20.8% during the first nine months of 2024, but it remains less profitable for investors in the gold market.

But this index achieved its strongest start since 1997, according to the FactSet company, which specializes in tracking global stock indices, when the US economy was on the rise during the dot-com boom under President Bill Clinton.

The Dow Jones Industrial Average grew by 11.8% during the first nine months of this year, while the Nasdaq 100 Index grew by 19.5% during the same period.