Gold at $3,000 per troy ounce, fiction or reality
Gold has always been considered a reliable asset for preserving capital during periods of economic instability.
Amid global challenges such as rising inflation, political instability and currency fluctuations, many are wondering if it is possible for the price of gold to rise to $3,000 per ounce.
In 2020, gold reached a historical high of about $2,000, and many experts did not believe that the price of the metal would go higher, but now the price is at $2,660 per troy ounce .
And it seems that gold at $3,000 is not such a fantasy, let’s consider how realistic this prospect is, and what could prevent a further rise in price.
- Inflation and monetary policy - Inflation remains one of the key factors in the growth of gold. This precious metal has traditionally been perceived as a hedge against currency depreciation, especially during periods of accelerating inflation.
If inflation remains high or rises, this could provide impetus for further growth to $3,000 per ounce.
- Political and Economic Instability - Geopolitical risks and political instability are also supporting gold prices. Conflicts, trade wars and economic sanctions create global uncertainty.
The situation in Ukraine, tensions between the US and China, problems in the Middle East - all this forces investors to look for safer assets.
Against the backdrop of these challenges, gold continues to remain a defensive asset, and if the geopolitical situation worsens, the demand for gold will also increase.
- Role of Central Banks - Central banks also play an important role in supporting the price of gold. In recent years, many countries such as Russia, China, Poland and Turkey have been increasing their gold reserves in an effort to reduce their dependence on the dollar. If central banks continue to increase their reserves, this will support rising gold prices.
It is also important to consider that the interest rate policies of major central banks, especially the US Federal Reserve, have a significant impact on the gold market. And as the latest news shows, the Fed has switched to a policy of lowering interest rates.
- Speculative Demand - With the price of gold rising to current levels of around $2,660 per ounce, speculative interest is increasing. Financial markets often react to psychological barriers.
The breakout of the $2,000 and $2,500 levels became important events in the gold market. If the price continues to move higher towards $2,800, we could see increased speculative demand pushing gold towards $3,000.
In addition, in volatile stock markets, gold is becoming increasingly attractive to investors seeking stability and risk protection.
Why gold may stop rising in price
Despite all the above factors, there are also possible obstacles to gold's growth that should be taken into account.
Reduced geopolitical tensions or improved economic indicators could lead to an outflow of funds from gold into higher-yielding assets such as stocks or bonds.
A drop in demand and an increase in supply of the precious metal will lead to a price rollback, as has happened more than once before.
The trigger for the downward trend could be the start of negotiations on Ukraine and the stabilization of the conflict in the Middle East, after which the price of gold is expected to decline to $2,300-2,400 per ounce.
Now there is a high probability that the price of gold will reach $3,000, most likely this will happen before the US elections. And then everything will depend on the results of the elections themselves; if Trump wins, a downward trend may form, and if Harris becomes president, then the upward trend is likely to continue.
Buy or sell gold - Brokers for trading gold and silver