Proactive Investors - Gold hit a new record high this morning at US$2,111 an ounce as investors flocked to the metal as the US dollar continued its retreat.
Having surpassed its previous high on Friday evening, gold continued to push ahead this morning.
Gold and the dollar have traditionally moved in opposite directions and since October when economists started to call an end to interest rate hikes, the metal has been on a tear.
From US$1,820 the gold price has risen by 15%, helped by record buying of the metal by Central banks, a trend that analysts expect to continue.
Bart Melek, head of commodity strategies at TD Securities, told CNBC he expects gold prices to average $2,100 in the second quarter of 2024, helped by central bank purchases.
Trade body the World Gold Council reported in May that a quarter of central banks intend to boost gold reserves in the coming year as an alternative to the US dollar.
Melek added this demand could keep the price of gold high for “years to come,” especially if confidence in the US dollar a a store of value drops further.
“The potential upside in gold prices will be closely tied to U.S. real rates and dollar moves, but we also expect persistent strong consumer demand from China and India, alongside central bank buying to offset downward pressures from upside growth surprises and rate cut repricing,” said Goldman Sachs (NYSE:GS) in a note.