Gold Glitters & Nickel Drops: 2024 Commodity Drama Unfolds

Gold Glitters & Nickel Drops: 2024 Commodity Drama Unfolds

Quick Look

  • Base metals face a subdued outlook for 2024, with weak demand pressuring prices.
  • Copper and aluminium are exceptions, expected to see modest price gains.
  • Nickel’s price should slump by 23% amidst a supply glut.
  • Gold prices should reach new highs.

2024 appears to be a challenging year for base metals, as analysts anticipate subdued demand that could dampen bullish supply pressures. Except for copper and aluminium, which may see slight increases of 2.8% and 2.1%, respectively, other base metals like zinc, lead, and tin should experience modest declines in price. Notably, nickel faces a tough year ahead with a forecasted 23% price drop, primarily due to a surge in production from Indonesia overwhelming its strong demand, largely fueled by the electric vehicle battery sector.

Gold’s Gleaming Prospects

In the 2024 market landscape, where base metals should face subdued demand and price pressures, gold shines brightly with promising prospects. J.P. Morgan forecasts gold prices could soar to $2,300 per ounce by 2025, buoyed by anticipated Federal Reserve rate cuts in late 2024, easing inflation, and ongoing economic uncertainties. This optimistic outlook for gold is largely due to its role as a safe-haven asset amid geopolitical tensions and its low correlation with other asset classes, making it an attractive investment during market volatility.

Gold’s appeal is enhanced in contrast to base metals, which might struggle due to weak demand. Its position as both a commodity and a monetary asset allows it to offer security and profitability, especially in uncertain times. Investors and analysts are thus closely monitoring gold as a beacon of strength in the commodities market, recognizing its potential as a barometer for broader economic health and investor sentiment in navigating the global economic landscape’s complexities.