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Will Gold Prices Decrease in the Future?

Curious about future gold prices? Explore predictions and insights on potential decreases. Click here to stay informed before making investment decisions.

Gold has owned a mature and established market for investors for years. Although it has been an essential commodity in the past, with significant importance in jewellery and electronics, it is often considered a safe investment method for various reasons.

It's a fact that Gold has been a safe asset for investors; it is also true that it has shown solid and steady growth over the years. However, it is not prone to high volatility or significant swings but is constantly growing.

This article will discuss whether there are chances of decreasing gold prices in the future; if not, what can be the options to store Gold as an asset.


Gold: A Short History

Over 4,000 years ago, Ancient Egyptians discovered Gold for the first time. For many centuries, Gold was stored and showcased as a symbol of wealth and power. Over the past centuries, Gold's demands have increased widely globally.

Like other commodities, gold prices are highly influenced by the demand and supply of the market. Yet, the yellow metal is most commonly seen as an investment asset that people have preserved for centuries and used during economic uncertainty.

Furthermore, the Gold is denominated in the US dollars, meaning it is inversely related to the US dollars. With the USD strengthening against other currencies, the price of gold rises, and overseas buyers become less interested in it.


Rising Momentum in Gold Prices in 2023

In May 2023, Gold reached its highest peak with a record of $2,067 - a milestone not achieved since March 2022. This increase was observed by the end of 2022, which showed a spike of 14% from November 2022 to the beginning of February 2022.

In 2023, investors took a lot of Gold in the hope of it retaining its value. The decision was made after looking at the economic pessimism and the upcoming recession.

All of these circumstances created a hassle among the investors and gold buyers, increasing the price of Gold.


Factors Affecting Gold Prices

From the childhood stories of princesses, leprechauns, and pirates, we have been taught and reinforced about the value of Gold. We have grown to identify yellow metal as a valuable asset.

Look at the factors influencing gold prices in this article section.

1.     Increase in Demand

With many uses, Gold is a highly demanded commodity that is always in demand. Commonly, Gold is used to manufacture electric conductors and is an essential material in life-saving devices.

Furthermore, Gold is invested and owned in different forms, such as gold biscuits, coins, and jewellery.

Instinctively, the increased demand for yellow metal results in an increase in gold prices. In the past years, the economic growth of India and China have fuelled the gold demand and thus increased prices.'

2.    Economic Uncertainty

Despite the volatile economic situations, Gold tends to hold its value, making it a reliable and safe asset. Central banks have their gold reserves to survive against the financial turmoil. Gold prices fluctuate highly with the economic uncertainty.

This uncertainty has widely increased investor concerns, leading to the global Gold rates.

3.    An Inverse Relation with the Fiat Currencies

Many countries globally have adopted the gold standards to define the value of their country's currency or the value of paper money. For instance, if Gold is $1000, then $1 will be 1/1000th ounce.

Gold is inversely related to the US dollar. When the dollar is strengthened, the gold prices decrease. That is why investors keep a keen eye on the US dollar prices and foreign exchange rates.

4.    Available Gold Worldwide

The total weight of Gold globally is approximately 198,000,000 kgs, and every year, about 3,000,000 kgs of Gold is added to the global gold stocks to meet the market needs and demands. However, it is estimated that this amount will not be enough to meet the market demands in the future. With less Gold available in the market, gold prices are assumed to increase.

Experts say only 20% of Gold is left in gold mines. New technologies might allow us to search for gold mines previously overlooked for financial or economic reasons.


Will Gold Price Decrease in the Future?

The gold price forecast for 2023 and 2024 is not that positive since the start of the year has been bullish. It is assumed that Gold will continue to be the centre of attraction while its prices may still be high due to the market's anxiety.

With the increase in inflation, more investors are looking to invest in Gold, leading to a massive change in gold prices in 2024.


Wrapping Up!

With the increased inflation, people are more concerned about finding reliable and trusted gold sellers. Al Romaizan Gold & Jewellers have operated in the gold industry for over 2 decades.

Subsequently, they comprehend how to help customers buy Gold for investment and saving purposes and can help make a better investment decision. 

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