Saxo Bank: These are the chances of a Christmas rally in gold

• Gold price with double-digit increase in 2024
• Price decline in November
• Is the price of gold recording its eighth consecutive Christmas rally?

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The year 2024 has left nothing to be desired for gold investors. Numerous factors have led to the sharp rise in the price of gold and even made new record highs possible. The war in Ukraine continues, with a new level of escalation recently reached by Russian President Putin deploying new medium-range missiles and downgrading the doctrine of the use of nuclear weapons. At the same time, geopolitical conflicts in the Middle East have flared up again. The uncertainty surrounding the outcome of the US presidential election at the beginning of November, from which Donald Trump emerged victorious, did the rest. Added to this are ongoing factors such as de-dollarization and heavy gold purchases by central banks.

Big plus in 2024

The gold price has risen by around 30.56 percent so far in 2024 (as of December 10, 2024). At the end of October, a new record high was set at $2,787.29. Meanwhile, a correction began in November. The gold price fell by 3.1 percent last month. Against this background, the question arises as to whether investors can still expect a Christmas rally in the precious metal this year.

Saxo Bank gives an outlook

The gold price analysis by Ole Hansen, head of raw materials strategy at Saxo Bank, which was published on its own website, can be used for this purpose. The expert is particularly looking towards the USA and President-elect Donald Trump, who has already announced in part how he wants to fill various government positions. The price of gold has fluctuated “back and forth with these announcements” in the last few weeks. Trump is pursuing “radical plans regarding tariffs, tax cuts and deportations,” said Hansen, which in turn would significantly increase the risk of a renewed flare-up of inflation and a rapid increase in debt. However, these are precisely the risks that investors want to protect themselves from with the help of gold.

So are the signs pointing green for a year-end rally? Not necessarily, warns Hansen. Given the significant gain that gold prices have already seen in 2024, investors should be prepared for profit-taking to occur: “Although the fundamentally supportive outlook has not changed through 2025, a rise of this magnitude before the end of the year could lead to profit-taking and lead to position resolutions”.

However, a look into the past can make you optimistic, because December has always been strong for the precious metal over the last seven years. Given the recent correction in the price of gold, according to the Saxo Bank expert, “the chances of a repeat have improved, as traders and investors no longer have to pay a record price to get involved.”

Macroeconomic factors remain

Hansen remains optimistic about the price of gold in 2025 – especially since the macroeconomic factors already mentioned would continue to be relevant in 2025. Central banks would continue to stock up on gold in order to make themselves more independent of US dollars and government bonds. The interest rate cuts that have already been implemented would also make holding gold more attractive again compared to investing in short-term bonds. Gold demand is also being fueled by China, as more Chinese investors are turning to gold investments “in view of record low savings rates and concerns about the real estate market.”

Not only in the United States, but all over the world, increasing debt would be accumulated, which would increase concerns about fiscal instability. “Ongoing global uncertainties continue to drive demand for safe-haven gold. Meanwhile, the Trump administration’s unfunded spending plans, inflation risks from tariffs and central banks’ efforts to deplete dollar reserves are likely to provide longer-term support,” Hansen concluded . It remains to be seen whether Saxo Bank is right in its assessment.

Editorial team finanzen.net