On March 16th, according to a research report by CITIC Securities, gold prices surged at the beginning of the year, with short-term pricing logic driven by the expectation of tariffs catalyzing the risk of spot delivery in New York. Looking at the short term, before the tariffs become clear, the fluctuation of futures and spot premiums may be difficult to completely stabilize, and cross market arbitrage firms may still provide support for gold prices. Looking at the medium term, since 2022, gold prices have deviated from the traditional frameworks of the US dollar and real interest rates. Especially in 2024, the traditional gold framework is clearly ineffective. Returning to the simple logic of supply and demand, the rise in gold prices in 2024 will be driven by two major demand factors, which are crucial in responding to the global macro situation. Firstly, the central bank’s purchasing power remains strong. This is the underlying reason for the upward trend of the gold price center after 2022. The underlying clue is the great power game, and the footnote is the geopolitical conflict. Secondly, the demand for private sector gold investment in Asia, especially in China, is expanding. The underlying clues are due to the reasons for China’s effective demand in 2024. Looking ahead to 2025, the demand factors that will drive the gold price in 2024 will continue to weaken in 2025. Therefore, we predict a “tailwind period” for gold on the high platform in 2024, and the gold price may move from a tailwind period to a volatile period in 2025.
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