Gold is closing 2024 with a stellar 27% gain—the metal’s largest annual increase since 2010—marking a standout performance in a year of turbulence for global commodities. The precious metal’s rally was fueled by US monetary easing, geopolitical uncertainties, and unprecedented central bank buying, even as other metals faced headwinds from China’s economic slowdown and volatile global markets.
Gold: The Year’s Shining Star
Gold’s rise to record highs throughout 2024 defied conventional market expectations. The metal climbed despite a stronger US dollar and rising real Treasury yields—factors typically seen as negative for bullion.
“The gold game looks to have changed,” noted David Scutt, an analyst at StoneX Group. “Its relentless performance has been the biggest market surprise of the year.”
Spot gold ended the year at US$2,625.95 an ounce, just below its October peak of US$2,790, as investors flocked to the safe-haven asset amid global uncertainties.
Drivers of Gold’s Rally
Several factors fueled gold’s dramatic surge:
- US Monetary Easing: Continued Federal Reserve policies to support the economy bolstered gold’s appeal.
- Geopolitical Tensions: Persistent global conflicts and economic volatility drove safe-haven demand.
- Central Bank Purchases: Central banks set records for gold acquisitions, further reinforcing the metal’s value.
Mixed Bag for Other Metals
While gold soared, other commodities saw varied fortunes:
- Base Metals: The LMEX Index, tracking six major metals, posted modest gains as weak Chinese demand offset supply concerns in copper and zinc.
- Iron Ore: Futures tumbled 28% in 2024, the sharpest drop since 2015, driven by a crisis in China’s steel industry amid low construction activity.
- Lithium: The battery metal faced a second consecutive annual decline as oversupply and challenges in the electric vehicle sector weighed heavily.
Spotlight on China’s Economic Slowdown
China’s prolonged economic malaise cast a shadow over the metals market in 2024, dampening demand across sectors. The slowdown particularly impacted industrial metals like iron ore and copper, which rely heavily on construction and manufacturing activity.
Looking Ahead to 2025
As the new year begins, market focus shifts to potential policy changes under President Donald Trump, US monetary decisions, and efforts by China to revive its economy. Analysts suggest that gold’s sustained momentum could signal a shift in market dynamics, while other metals may face continued volatility.
Copper, for instance, ended the year at US$8,768 a tonne on the London Metal Exchange, down 1.6% in the final trading session of 2024, reflecting ongoing concerns about demand.
Conclusion
In a year marked by uncertainty, gold’s record-breaking gains reaffirm its status as a reliable safe-haven asset. As 2025 unfolds, investors will watch closely to see whether gold’s upward trajectory continues and how other metals navigate an evolving economic landscape.
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