Gold and silver showed no signs of slowing on Monday as investors continued to pour into precious metals.
Gold futures (GC=F) rose as much as 0.8%, hitting a new record as it hovered around a high of $2,750 per ounce. Silver futures (SI=F) rose more than 3% before the rally, briefly topping $34 an ounce, a 12-year high.
The two precious metals have outperformed the broader market, with bullion up 26% year-to-date and silver up over the same period, compared to the S&P 500 (^GSPC)’s 19% rise since the beginning of 2024. It increased by 35%.
Central bank purchases, which reached record levels in the first quarter of 2024, have been one of the biggest drivers of precious metals’ rally this year. BofA analysts estimate that gold has surpassed the euro to become the world’s largest reserve asset after the US dollar.
Investors are also flocking to physically backed gold exchange-traded funds (ETFS), with inflows increasing for the third straight month, according to the World Gold Council.
“This is due to lower inflation expectations and asset rotation, which tends to perform better with a more dovish Fed,” Phil Streible, chief market strategist at Blue Line Futures, told Yahoo Finance on Monday morning. I think so,” he said.
The strategist expects gold prices to reach $2,850 by the end of the year.
HANGZHOU, CHINA – OCTOBER 18: Gold bars are on display at a gold jewelry store in Hangzhou, Zhejiang Province, China on October 18, 2024. Gold prices are building on the upward trend seen over the past week or so. (Photo credit: Ni Lifang/VCG via Getty Images) (VCG via Getty Images)
Meanwhile, silver soared after rising more than 6% on Friday. JPMorgan analysts cited sentiment from the recent London Bullion Market Association/London Platinum and Palladium Market Conference, where attendees expected the average future price for the gray metal to be $45 per ounce. He said there was.
“This bullish view is driven by a sense that silver is undervalued relative to gold, less crowded, and supported by multi-dimensional and versatile demand applications,” JPMorgan analysts wrote on Friday. “It has been done,” he said.
Silver is used in a variety of industries, from electronics to auto parts, fuel cells and solar panels. Analysts say the future for metals will be uncertain if former President Donald Trump wins the presidential election.
“While we ourselves are bullish on silver, industrial metals prices will need to continue rising into 2025 to achieve this solid silver outperformance. The situation could become complicated under hard-line measures and “China’s stimulus,” the memo said.
Ines Ferre is a senior business reporter at Yahoo Finance. Follow her on X @ines_ferre.
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