Up 800% in 21st Century, Gold Price Shocks Forecasts Again on 2025 Eve
Tuesday, 12/31/2024 12:29
The PRICE of GOLD ended London trading on Tuesday with a gain of 26.6% from last New Year's Eve while silver added 21.5% for the year as the global bullion markets closed for the 2025 celebrations.
Across the first quarter of the 21st Century,
that put gold 797.7% higher since Millennium Eve, outperforming all other major asset classes and shocking the consensus view that gold bullion was finished as an investment.
Gold shocked the consensus again in 2024, beating analyst predictions – as gathered and published in the London Bullion Market Association's annual
Forecast Survey competition – for the 9th time in the past 15 years.
Averaging $2386 per Troy ounce this year, the price of gold rose by 23.0% on an annual average basis, rather than gaining only 6.1% as professional analysts expected.
That made 2024 the biggest miss for professional bullion market analysts since
the gold crash of 2013, when gold's annual average price sank by 15.5% rather than rising 5.0% to a new all-time high as predicted.
2024's most bullish forecaster – and therefore this year's
LBMA Forecast Survey winner – was Chantelle Schieven of Capitalight Research.
But Schieven's annual average price prediction was still out by more than $216 per Troy ounce, under-estimating gold's performance by some 9.0%. That was the biggest-ever Dollar price miss for a winning forecast – and also the widest winning miss in percentage terms – since René Hochreiter's prediction of gold $1600 won the prize in 2013, fully 13.4% above the annual average of $1411.
Although the price of silver sank into New Year 2025, ending 31 December close to a 15-week low at $28.90 per Troy ounce, analyst forecasts for the more industrially-useful precious metal were also too bearish in 2024.
On average, LBMA Survey entrants predicted that
silver prices would rise 6.2% in Dollar terms in 2024 rather than delivering the 21.0% annual average jump which it realized.
In contrast to gold, however, that marked only the 5th time in the past 15 years that professional analysts as a group weren't bullish enough on silver. More typically they have over-estimated its price performance, forecasting on average that prices would trade 2.9% above the actual outcome since 2010.
For gold prices, the gap between the LBMA Survey's consensus outlook and the annual outcome has averaged -0.9% over the past 15 years.
That said, this January's LBMA Survey consensus lagged silver's 2024 outcome by 12.2%, the biggest miss since analysts forecast a massive 38.7% rise for 2021 – a move which would have taken silver above this year's 12-year high of $28.26 on an average annual basis – rather than the 22.3% gain it delivered as the world economy reopened from the Covid pandemic.
US equities meanwhile failed to outrun the gains in gold this year, with the S&P500 price index rising 23.8% across 2024.
Crude oil slipped 3.0% to its lowest annual finish since the Covid pandemic and global economic slump of 2020.
Copper added 3.7% but ended the year more than 1/5th below the new all-time highs hit in May.
Bond yields meanwhile defied the start of central bank cuts to short-term interest rates, rising by 2/3rds of a percent on 10-year US Treasury debt to 4.52% per annum.
That marked the 4th steepest annual rise in Washington's borrowing costs of the 21st Century so far.
The US Dollar meanwhile gained more than 5.6% in 2024 on its trade-weighted DXY index against the developed world's other major currencies.
That failed to reverse the Dollar's big drop of last year. But outside the 21-year annual closing high of 2022 – when stocks and bond prices had both sunk in the face of surging interest rates – it still put the world's No.1 reserve currency at its strongest New Year's Eve value since 2001.
Despite the rising Dollar, gold's twice-daily London benchmark set 38 new all-time highs against the US currency in 2024, matching the count of 2011 – peak of the precious metal's financial crisis' bull market – with the most fresh records since the inflation and geopolitical crises of 1979 led to what then became gold's all-time high for almost 3 decades in January 1980.
The gold price in Euros and in the UK Pound meantime set 45 and 40 new all-time highs respectively, a fresh annual record for gold priced in those currencies.
As London trading shut for the eve of 2025 today, the UK gold price in Pounds per ounce stood 28.4% higher from the end of last year, its strongest jump since 2016's jump of 31.6% on
the Brexit referendum shock.
Gold priced in the 20-nation Euro currency rose 34.4% in 2024, its biggest year-on-year gain since the 37.7% jump made during
2010's government debt crisis.
Gold bullion landed in China – the world's 2nd largest economy and the precious metal's No.1 consumer market – meanwhile rose by 28.1% on the Shanghai Gold Exchange,
hurting consumer demand after a
surge of Chinese private investment this spring drove global prices sharply higher.
Western investing demand has in contrast remained quiet, with
BullionVault users continuing to take profit from gold's run of new record prices and inflows to gold-backed ETF trust funds barely moving.
"Silver investors added to holdings," says a New Year's Eve note from metals strategist Nicky Shiels at bullion refining and finance group MKS Pamp.
"[But] gold investors [as tracked by Comex derivatives positions plus ETFs] only added 2.1 million ounces" across the year.
Central banks buying gold "added almost 15x as much," says Shiels.
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