Why gold is outperforming nearly everything this year

Published On Aug 28, 2024, 6:00 AM

Gold has significantly outperformed other assets this year, with prices soaring to $2,555.2 per ounce. It currently stands as the second-best asset after cryptocurrency, with a year-to-date gain of 23%. Central banks, particularly in emerging markets, have been buying gold at unprecedented rates, with a record 290 tonnes purchased in the first quarter of 2024. Central banks' total purchases in 2024 are projected to exceed 1,000 tonnes. This trend has cemented gold's status as a key reserve asset, surpassing the euro. The appeal of gold lies in its low correlation with stocks, making it a preferred safe haven amid economic uncertainty and inflation concerns. Recent inflows into gold funds could signal growing interest from retail and institutional investors, while the volatility of gold prices continues to attract traders.