There are plenty of gold bulls calling for the price of the yellow metal to double, triple and even quadruple the current figure.
The gold price started off 2020 trading at US$1,527 per ounce, and by May the yellow metal was sitting above US$1,700, a price level not seen since late 2012.
However, the market couldn’t sustain that level for long, and gold had dipped below US$1,900 by the start of the fourth quarter.
“The pandemic invoked unprecedented economic uncertainty, which led to a surge in safe-haven demand and, in turn, boosted gold prices,” Burke told the Investing News Network .
In fact, in the first quarter of 2021, the gold price fell by 8.1 percent to hit US$1,744 by the end of March.
Heading into late May 2021, gold broke through the US$1,900 level, with some analysts calling for a repeat of the summer of 2020 with another record-breaking gold price on the horizon.
As of its April 2021 meeting, the central bank had no plans to hike interest rates — in fact, some economists at the central bank are arguing for sub-zero interest rates.
Gold bars and gold coins saw an increase of 3 percent in annual demand, while gold exchange-traded funds reached record year-end holdings of 3,751.5 tonnes, up 120 percent year-over-year.
China and India are the two largest markets for gold jewelry, and both countries’ citizens have seen their purchasing power decimated by the coronavirus pandemic.
On the industrial side, gold is used in electronics technology and is benefiting from the rise of nanotechnology.
“Although 2020 marked the 11th consecutive year of net purchasing by central banks, it was the lowest annual total for central bank purchasing since that trend began in 2010,” notes the WGC.
In its Q1 2021 gold report, the council revealed that consumer gold demand was on the rise, with jewelry demand up 52 percent over the same quarter in 2020.
Gold broke through the US$1,900 level in Q2 2021, leading investors to dream of another Summer of Love for the precious metal.
Paul Research, which is part of Agora Financial, told INN that he sees continued weakness in the US dollar as very supportive for gold.
Ed Moy, chief market strategist at Valaurum and former director of the US Mint, told INN in early May that he expects gold will trade between US$2,000 and US$2,100 by the end of 2021.
“So even though the spot price is well below that, to me the real price of gold is what the market is willing to pay for it — and they’re willing to pay up to US$2,100,” he noted.
Gareth Soloway, chief market strategist at InTheMoneyStocks.com, is even more bullish on gold.
“You have gold replicating to basically the tee exactly what it did the last time it broke above its high.
And INN’s Twitter followers agree — at the end of May, we asked whether gold will reach US$2,000 again this summer.