Gold has experienced a remarkable rise in 2024, reaching 40 new record highs year-to-date and appreciating by over 28%. According to the World Gold Council (WGC), this surge has made gold the best-performing asset class globally, surpassing US stocks, emerging market stocks, US bonds, and even US currency. In the third quarter of 2024, gold demand exceeded $100 billion for the first time, showcasing its robust market position.

Looking ahead to 2025, the direction of the US Federal Reserve's policies and the movement of the US dollar will remain crucial for gold prices. The WGC predicts that the Fed could implement rate cuts of up to 100 basis points by the end of 2025, with inflation expected to soften but remain above target. Additionally, European central banks may follow suit with similar rate cuts, and the US dollar is likely to either remain flat or weaken slightly.

Factors like economic expansion, consumer demand, and geopolitical risks are also set to influence gold prices. The US's economic policies, particularly its "America First" agenda, could lead to inflationary pressures and supply chain disruptions, further supporting gold as a safe-haven investment. Additionally, concerns about European sovereign debt are resurfacing, adding to market uncertainty.

Asian demand for gold, particularly from India, has played a significant role in this performance. The reduction of the import duty in India boosted gold consumption in the second half of the year. India's economic growth remains strong, and even potential tariff increases will have a less significant impact on its economy compared to other US trading partners. Central bank demand for gold has also remained strong, with purchases exceeding 500 tonnes in 2024, contributing positively to gold's performance.