Given its status as a reliable store of value, gold tends to perform well in times of economic uncertainty and is often used as a hedge against inflation. With high demand for the precious metal, prices of gold are likely to edge higher. Moreover, experts expect gold to reach new highs and beyond in 2024.
Given an optimistic long-term outlook for gold, it could be wise to buy quality gold stocks Alamos Gold Inc. (AGI – Get Rating), Harmony Gold Mining Company Limited (HMY – Get Rating), and Eldorado Gold Corporation (EGO – Get Rating) for stable returns and portfolio diversification.
Gold is often seen as a hedge against inflation. When the value of currencies drops due to rising inflation, investors tend to buy gold to preserve the value of their investment, which boosts the demand for gold, pushing its prices higher. Inflation posted its biggest monthly increase of 2023 in August.
While the Federal Reserve still hopes to bring down the inflation rate to its target of 2%, it has paused interest rate hikes this month, holding its key lending rate steady at the 22-year high of 5.25% to 5.5%. While the Fed skipped hiking rates for the second time this year, it hints at another increase before the year-end.
While gold prices may remain volatile in the short term due to uncertainty surrounding the Fed’s interest rate trajectory, experts believe that the medium to long-term outlook for gold appears optimistic.
Gold prices are on track to surge to all-time highs next year amid tapering interest rates and looming recession worries that elevate the precious metal’s role as a safe haven asset.
“I do see gold move above $2,100 in late 2023, early 2024 as a trading level,” said TD Securities’ managing director and global head of commodity strategy, Bart Melek. Gold has outperformed other major asset classes in the past 12 months, Melek wrote in a recent report.
Further, Livermore Partners predicts gold prices to…
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