Gold Prices Hit Fresh Peak in 2023

SEATTLE (Scrap Monster): The Wold Gold Council, in its latest Gold Market Commentary, noted that the emerging market (EM) demand for gold not only ignited the subdued developed market (DM) activity, but also lifted gold prices to record highs during the previous year. It must be noted that gold prices recorded 15% surge in 2023 to close at the highest annual level of $2,078 per ounce.

According to WGC, a significant contributor to the positive price environment was the boosted demand for gold from central banks, especially from EM institutions. This demand is estimated to have added nearly 15% to the gold’s performance in 2023. The elevated geopolitical risks too were a key driver, contributing almost 5% to the yellow metal’s annual returns.

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The only small drag during the year was the bond yields, which after hitting highs in October, ended at more or less the same levels it started the year.

Looking forward, WGC report noted that geopolitical risks continue to bubble in the Middle East region, which in turn is expected to add near-term inflationary risks. It foresees soft demand for gold in China. In this context, gold is likely to witness a lacklustre performance. Any upside in gold will be hugely dependent on extended central bank demand, it noted.