By Imaru Casanova, Portfolio Manager, Gold and Precious Metals
John Maynard Keynes famously critiqued the gold standard as a “barbarous relic,” yet recent trends in the gold market might suggest otherwise. Gold has hit all-time highs—and its investment demand hasn’t even reached peak levels yet, according to Portfolio Manager Ima Casanova. Despite the Federal Reserve’s interest rate hikes (usually detrimental to gold), the price of gold has risen by 15% in 2024, reaching $2,409 per ounce.
What’s driving the rally? Massive purchases by emerging market central banks (particularly China, India and Turkey) are helping sustain gold prices even as more traditional drivers of demand have lagged. Looking forward, gold is well positioned to continue its rally, especially if Western investors begin to return to the market. The anticipation of rate cuts by the Federal Reserve, along with continued inflationary pressures and geopolitical risks, are likely to further bolster gold’s appeal as a hedge against market volatility.
Read the full article for more on Ima’s bullish outlook on gold and mining stocks as well as her views on how investors should approach allocating to gold—both bullion and equities.
Read Barron’s Q&A: Gold Prices Can Keep Rallying, This Investing Pro Says. Here Are Her Picks.
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Originally published 24 April 2024.
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