Investment Insights

Gold is poised for its best annual performance in more than a decade – up 28% through November. Behind this, central bank and investor buying have more than offset a notable deceleration in consumer demand.

While gold’s contribution to managing portfolio risk is well established, its contribution to portfolio return is not. Our analysis shows that gold responds to both an economic and a financial component. And that its long-term return is not only well above inflation but more closely linked to GDP than previously understood.

August has typically been kind to gold, but seasonal winds are up against strong cross currents, that on balance look much more supportive than not.

Gold has performed remarkably well in 2024, rising by 12% y-t-d and outperforming other major asset classes. As we look ahead, the key question remains: will gold’s momentum continue or is it running out of steam?

While gold investments have been gaining popularity among Japanese households, both life, and property and casualty (P&C) insurers have made limited gold investments, despite the sheer size of the Japanese insurance market in terms of premiums and assets.

In January, gold gave back gains after hitting an all-time high at the close of 2023. Looking forward, hot US growth data may delay lower rates, but politics and geopolitics will likely maintain interest in gold.

This compendium brings together a series of reports published over the last three years, giving unparalleled insight into the key factors that underpin India’s gold market, including the drivers of gold demand, the changing structure of the jewellery market, the new investment landscape, and the dynamics of gold supply.

As we look forward to 2024, we explore three economic scenarios and their likely impact on gold. Historically, gold has had a flat performance during consensus-favoured ‘soft landings’; however, geopolitical risks, central bank buying and the spectre of a recession may provide additional support for gold.