Can Precious Metals Continue to Rally?

Gold prices have been rallying, and earlier this month, the precious metal hit a record high of roughly $2,440 per ounce. Prices have come down since then, but the metals rally might not be over yet.

High Demand

Gold is a so-called safe haven investment that often sees higher demand during times of trouble, be it in the markets on the political stage. And the global geopolitical turmoil of the moment is a key part of the gold rally of this spring. It’s also the reason some analysts expect metals prices will continue to climb higher as we move into the summer. After all, geopolitical stresses remain unresolved.

Central banks are also keen to have gold in their vaults – literally. And despite surging prices, demand for gold jewelry has remained strong. Much of this demand has been driven by Chinese consumers. In 2023, gold jewelry consumption in China rose 10% annually.

Limited supply is also part of the high demand for metals. This extends beyond gold, too. For example, tighter supply of copper, which is key for electric vehicles, means higher demand. The International Copper Study Group recently slashed its copper production forecasts for the remainder of the year thanks to several delays in mining projects, which could put upward pressure on the metal’s price.

Silver has also seen strong demand lately. The metal is widely used in technology like cars, solar panels, and smartphones.

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