Home Business News The reasons behind record high gold price and why to invest in 2024

The reasons behind record high gold price and why to invest in 2024

by Thea Coates Finance Reporter
26th Mar 24 9:21 am

On March 21st 2024, the price of gold price reached an unprecedented high of £1,734 per ounce.

With the gold market reaching new heights, experts at The Gold Bullion Company have explained some of the reasons behind the surge as well as why 2024 is a great time to invest.

Reasons behind all-time high gold price:

Economic uncertainty

The demand for gold tends to surge massively during economic crises and recession as it’s seen as a safe-haven asset. With the devaluation of some of the world’s major currencies, investors have turned to gold as a defensive asset as a response to economic uncertainty.


The World inflation rate for 2022 was 8.27%, a 4.8% increase from 2021. During an inflationary period for the economy, investors often opt for gold over cash due to its stability.

This is because any devaluation of currencies resulting from inflation will increase the price of gold in that currency, so preserving the buying power of the investment. This increased demand for gold can also lead to an increase in its price and value.


Investors look to diversify when there are disappointing performances in other asset classes. For example, when the stock market performs poorly, investors often use gold to diversify their portfolios as the price of gold often behaves differently to shares as gold is a finite resource.


Gold is viewed as a hedge against economic and political uncertainty, and while other asset classes fluctuate in value wildly during financial crises and recessions, gold retains its value over time. The past few years have seen a range of geopolitical conflicts arise leading to its upward price trajectory.

Gold also offers a type of investment insurance. Following 2022’s crypto crash, there was an increase in investors moving from digital assets like Bitcoin to physical assets like gold.

Retail purchases

Stronger gold prices are also driven by retail purchases of jewellery, bars and coins. Large countries, such as the US, India, and China, require and purchase a large amount of gold for jewellery production, making the price of gold rise.

Central bank gold-buying

Central banks, who have bought historic levels of gold since 2022, continue to be strong buyers in 2024. Gold’s performance in crises and its role as a long-term store of value are key reasons for central banks buying gold. This demand makes gold more valuable.


Gold mining production has remained similar since 2016. This means the easy gold has already been mined, and miners now have to dig deeper to access quality gold reserves: increased challenges, dangers, costs and time needed to mine gold result in higher gold prices.

Rick Kanda, Managing Director at The Gold Bullion Company said, “There have been a range of reasons for the all-time high gold prices, however, they nearly all come back to the fact that gold is a stable investment. Gold has historically been seen as a reliable store of value during economic and political uncertainty, making it unsurprising that a record number of investors backed gold in 2023.

“As demand increases, so does the value of gold making 2024 a great time to start investing. To help anyone interested in investing, we have shared our top tips on how to get started.”

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