Mumbai, Dec 23
Gold and silver have experienced an impressive rally in 2024, gaining approximately 30 per cent and 35 per cent, respectively, on the Commodity Exchange (COMEX), a report showed on Monday.
While central bank policies and geopolitical risks are significant drivers of gold and silver prices, other factors also play a role in shaping the market, according to the report by Motilal Oswal Financial Services Ltd (MOFSL).
In 2024, global demand for precious metals has increased substantially. Central banks worldwide, including those in emerging markets, have been net buyers of gold for over a decade. In 2024, they collectively purchased more than 500 tonnes of gold, reflecting a strategy to diversify reserves amid economic uncertainties, said the report.
“Looking ahead, the outlook for gold and silver remains positive, although some market consolidation or short-term dips may present buying opportunities. Loose monetary policy environment, coupled with ongoing geopolitical risks, should continue to provide a favourable backdrop for gold and silver,” said Manav Modi, analyst, Commodity Research, MOFSL.
This growing interest from central banks has added upward pressure on prices, as these institutions accumulate gold as a hedge against the volatility of fiat currencies.
The recent resurgence in gold ETFs, which had seen outflows in previous years, indicates renewed investor interest in gold as a safe-haven asset.