UBS, a well-established financial services company, has made a bold prediction for the future of gold prices. According to their analysis, they anticipate a significant increase of 10% in gold prices by the year 2024. This projection is primarily based on the expected policy changes by the U.S. Federal Reserve, which is likely to initiate interest rate cuts as early as May.
UBS's Optimistic Outlook: Gold Price Rise and Rate Cuts
In a recent note, UBS, a Swiss financial services company with a global presence in over 50 countries, expressed its positive outlook on the gold market for the upcoming year. Despite the price decline witnessed in December, UBS analysts believe that gold prices could surge by up to 10% above the current market rates.
UBS predicts that gold may potentially reach $2250 per ounce in 2024. Several factors contribute to this optimistic projection, including the possibility of interest rate cuts by the U.S. Federal Reserve, which would reignite interest in the gold market.
The financial institution emphasizes that the impact of the Federal Reserve's policy shift should not be underestimated. While the exact timing of the interest rate cuts remains uncertain, UBS expects a substantial rate cut of 100 basis points to occur as early as May. This move is likely to exert downward pressure on the U.S. dollar and real interest rates, thereby stimulating fresh demand, particularly from exchange-traded gold funds.
In December, the World Gold Council (WGC) predicted a stagnant performance for gold in a "soft landing" scenario, a declaration that U.S. Treasury Secretary Janet Yellen has already affirmed. However, UBS maintains that ongoing macroeconomic and geopolitical risks justify holding exposure to gold for hedging and diversification purposes. Gold is traditionally regarded as a safe haven asset due to its lack of credit risk and its negative correlation to risk assets, as highlighted by Johan Palmberg, an analyst at WGC.
What is your opinion on UBS's prediction regarding gold prices in 2024? Please share your thoughts in the comments section below.
Frequently Asked Questions
How Much of Your IRA Should Include Precious Metals?
When investing in precious metals, the most important thing to know is that they aren’t just for wealthy people. You don’t have to be rich to invest in them. There are many methods to make money off of silver and gold investments.
You may consider buying physical coins such as bullion bars or rounds. Also, you could buy shares in companies producing precious metals. You may also be interested in an IRA transfer program offered by your retirement provider.
Regardless of your choice, you’ll still benefit from owning precious metals. These metals are not stocks, but they can still provide long-term growth.
They also tend to appreciate over time, unlike traditional investments. If you decide to sell your investment, you will likely make more than with traditional investments.
Can I buy gold using my self-directed IRA
You can purchase gold with your self-directed IRA, but you must first open an account at a brokerage firm like TD Ameritrade. If you have an existing retirement account, you can transfer funds to another one.
The IRS allows individuals contributing up to $5.500 each ($6,500 if married, filing jointly) into a traditional IRA. Individuals can contribute as much as $1,000 per year ($2,000 if married filing jointly) to a Roth IRA.
If you do decide that you want to invest, it is a good idea to buy physical bullion and not in futures. Futures contracts, which are financial instruments based upon the price of gold, are financial instruments. These contracts allow you to speculate on future gold prices without actually owning it. However, physical bullion is real gold or silver bars you can hold in your hands.
Who has the gold in a IRA gold?
The IRS considers anyone who owns gold to be “a form money” and therefore subject to taxation.
You must have at least $10,000 in gold and keep it for at most five years to qualify for this tax-free status.
While gold may be a great investment to help prevent inflation and volatility in the market, it’s not wise to keep it if you won’t use it.
If you plan to eventually sell the gold, you’ll need a report on its value. This could impact the amount of capital gains taxes your owe if you cash in your investments.
You should consult a financial planner or accountant to see what options are available to you.
What is the best precious metal to invest in?
The answer to this question depends on how much risk you are willing to take and what type of return you want. While gold is considered a safe investment option, it can also be a risky choice. Gold may not be right for you if you want quick profits. If patience and time are your priorities, silver is the best investment.
If you don’t care about getting rich quickly, gold is probably the way to go. Silver may be a better option for investors who want long-term steady returns.
Statistics
- The price of gold jumped 131 percent from late 2007 to September 2011, when it hit a high of $1,921 an ounce, according to the World Gold Council. (aarp.org)
- Contribution limits$6,000 (49 and under) $7,000 (50 and up)$6,000 (49 and under) $7,000 (50 and up)$58,000 or 25% of your annual compensation (whichever is smaller) (lendedu.com)
- If you take distributions before hitting 59.5, you’ll owe a 10% penalty on the amount withdrawn. (lendedu.com)
- Indeed, several financial advisers interviewed for this article suggest you invest 5 to 15 percent of your portfolio in gold, just in case. (aarp.org)
- This is a 15% margin that has shown no stable direction of growth but fluctuates seemingly at random. (smartasset.com)
External Links
forbes.com
- Gold IRA – Add Sparkle to Your Retirement Nest Egg
- Understanding China’s Evergrande Crisis – Forbes Advisor
wsj.com
- Saddam Hussein’s InvasionHelped Uncage a Bear in 1990 – WSJ
- Want to Keep Gold in Your IRA at Home? It’s Not Exactly Legal – WSJ
