In December alone, the return on gold investments in dollars—measured from the beginning of the calendar year—fluctuated between 27-33%, marking one of the highest returns in history.
Over the past 12 months, the highest price for gold reached $2,801.65 per ounce, while the lowest price was $1,988.65.
Interestingly, the discovery of the world’s largest known gold deposits in the Hunan Province of central China, valued at over $80 billion and estimated to hold more than 1,000 tons of gold up to a depth of 3,000 meters according to a local geological institute, did not impact global gold prices.
“These deposits are classified as a gold reserve, but China is not the country with the largest resources; those are Australia and South Africa. We don’t yet know if mining these new deposits in China would be profitable. Therefore, while this discovery is noteworthy, it doesn’t change the market dynamics,” said Michał Stajniak, Deputy Director of the Analysis Department at XTB, in an interview with MarketNews24.
Demand for Gold Remains Strong
Despite the largest price correction of 2024 occurring in mid-November—when gold dropped to $2,543 after reaching a historical high—demand for gold remains robust. Earlier in January, gold also experienced a smaller correction, and June saw a period of price stagnation.
Looking forward to 2025, the outlook remains promising, driven by solid demand from central banks and steady interest in physical gold (bars, coins, and jewelry). Additionally, there has been a revival of demand for gold-backed ETFs.
New Record Highs Expected in 2025
The likelihood of setting new historical highs in 2025 is strong due to ongoing global uncertainties, including conflicts in the Middle East and Ukraine, and the uncertain policies of Donald Trump, which are yet to be fully revealed.
“The geopolitical risk premium was significant in 2024. With central banks expected to continue lowering interest rates, this should support gold prices,” Stajniak explains. “Reaching peaks around $3,000 per ounce is realistic.”
Polish Investors and Currency Considerations
For Polish investors, the currency market’s dynamics are crucial. In 2024, the 10,000 PLN per ounce barrier was surpassed. To provide context, in 2000, gold was priced at just 1,000 PLN per ounce. This highlights the long-term potential of gold investments.
“Gold investments should be made with at least a five-year horizon in mind. However, those who bought gold in 2011 had to wait quite a while for their investment to pay off,” Stajniak from XTB explains.
Source: ManagerPlus
