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Gold at All Time High: Is it Time to Buy, Sell, or Hold?

Gold All Time High

As of late-October, 2024, gold spot is hovering near all-time highs. Investors, collectors, and anyone with an interest in gold are taking note. This article goes over the new gold all time high, what it means for investors, and what might be up next for gold prices.

Gold All Time High: $2,781 Per Ounce

Update 10/29/24: Gold has again reached a new all-time high; this article has been updated.

Gold hit a new all-time late October 2024, clocking in at a whopping $2,781 per troy ounce. In general, gold spot prices have remained in the $2,600+ range for the month of October.

Gold prices have set several new all time highs throughout 2024, with fresh highs set in March, May, August and again in September.

What’s Behind Gold’s Price Spike?

Many factors lead to gold’s recent price increase. The most noteworthy causes were likely:

More aggressive rate cuts: The Federal Reserve was widely expected to cut rates by 0.25% at their September meeting. Instead, they cut rates by 0.5%, a much more aggressive cut than expected. This move spurred a rally in various asset classes, from gold to equities.

Softer US dollar: The value of the US dollar has been in decline recently, which puts upward pressure on the price of gold. The strength of the US dollar is generally inversely correlated to the price of gold, because gold is priced in US dollars. When the value of the dollar decreases, the same ounce of gold can be traded for more US dollars – and vice versa.

Safe-haven demand: Various world events, including tensions in the middle east and the upcoming election cycle, are driving demand for “safe-haven” assets like gold. When uncertainty is prominent on the world stage, investors often flock to assets that traditionally perform well during these cycles, including gold and bonds.

What’s Next for Gold Prices (2024 & 2025 Outlook)

While it’s impossible to predict the future, we can look at some of the ongoing trends to try to figure out an outlook for gold moving forward. Keep in mind that this is for informational purposes only and should not be considered investing advice.

More Rate Cuts are Expected in 2025

Historically, interest rates and gold prices have an inverse relationship – meaning that as rates fall, gold prices tend to rise. With more rate cuts expected in 2025, this could be a positive catalyst for gold prices.

With that said, it’s completely possible that the expected rate cuts are already priced in to the price of gold. And gold prices are not a simple thing – there are dozens of factors that contribute to the price of any asset class, but particularly so for gold.

Analysts Are Bullish on Gold

Researchers from Goldman Sachs are calling for gold to surpass $2,700 per ounce by early 2025. Other analysts are even more bullish, with analysts from Citi calling for gold to surpass $3,000 per ounce. Whether this plays out or not remains to be seen.

Inflation May Be Less Prominent in 2025

Inflation has been wreaking havoc on the economy, and influencing all sorts of asset prices including gold. But inflation rates have cooled dramatically, reaching just 2.4% (as measured by the CPI) in September 2024. Just one year ago, inflation was at a whopping 8.2%.

Inflation’s effect on gold prices is complex. Gold is traditionally seen as a hedge against inflation, as its value tends to increase when the purchasing power of the US dollar erodes. But many believe that changes in CPI have already been priced into asset classes, including gold. Regardless, softening inflation may dampen demand from gold investors.

Demand from Central Banks is Mixed

Central banks are major buyers of gold. They buy and sell gold to strategically strengthen their currency and wealth reserves, stabilize their currencies, and to help achieve geopolitical goals. Recently, the new gold all time high price has slowed buying from prominent central banks like China, who has held back on buying gold for 5 straight months as of September 2024.

At the same time, central banks from Mexico, Czech Republic and others are increasing their gold purchases. Overall, global central banks increased gold reserve purchases by 6% in the second quarter if 2024. Analysts are uncertain where central bank demand will head next year, but this could be a key factor to watch for gold prices in 2025.

Are You Buying, Selling, or Holding Gold?

There’s a lot to think about with the new gold all time high, and a lot of uncertainty moving forward into 2025. Are you buying more gold, selling some of your stack, or holding your current reserves?

Whether you’re buying or selling, working with a trusted partner is crucial. At Bellevue Rare Coins, we’ve helped Seattle-area people buy and sell gold for over four decades. With convenient locations in Bellevue, Issaquah, Lynnwood and Tacoma, we’re the Northwest’s trusted gold buyer and dealer. Contact Bellevue Rare Coins today to learn how we can help you with your buying or selling needs.

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