Gold prices have been on a rampage, hitting record after record since the beginning of the year. The conventional wisdom has always been that gold spikes when geopolitical tensions escalate or economic uncertainty spreads-the traditional bread and butter of gold bugs. The prospect of a US soft landing and lower interest rates have also added fuel to the sparkly fire.
But 2024's gold rush is different from most in at least one key way. In the Bloomberg Originals mini-documentary Who Is Behind Gold's Crazy Rise? we reveal that-along with conflicts like Russia's war on Ukraine and the regional conflagration in the Middle East-something else has been driving gold prices this year.
It's hard to think of a safer asset than gold-a fact that hasn't been lost on central banks or consumers. One derivative of the Kremlin's botched effort to annex its neighbor has been the West's successful effort to freeze Russian assets. The move set off alarm bells around the world, spurring central banks to protect themselves. The People's Bank of China led the way, loading up on gold to diversify away from dollars.
But it was the Chinese people who really drove the gold train in 2024. Unsettled not only by global instability but a struggling domestic economy, the nation's massive consumer market moved to scoop up gold jewelry-and even bullion-to protect against the unknown, sending prices skyward. By October though, a funny thing was happening to the red-hot gold market. Watch Who Is Behind Gold's Crazy Rise? to find out more.
