By Matt Richardson
Copyright cbsnews
The price of gold has risen significantly this year, following a remarkable surge from just the start of 2024. At that point, the price of gold per ounce was just $2,063.73. But as of Wednesday, the cost for the same amount of gold was a staggering $3,678.26. That’s up almost 80% in just over 18 months, approximately.And the price surge may not even be over. After moving past $3,600 per ounce earlier this month – the latest in a series of record-breaking movements – there’s a strong possibility that the price could soon break the $4,000 mark. While this could be good for investors who already have a portion of gold in their portfolio, it should be the motivation for beginners and others who have yet to get started to take action now, before they’re priced out of the market entirely.To better understand the motivation for acting promptly, then, it helps to understand the current dynamics that could push the price of gold past $4,000 per ounce, perhaps as soon as this September. Below, we’ll examine three influencing factors investors should evaluate now.Start exploring your top gold investing options here.Why the price of gold could hit $4,000 this SeptemberThere are three primary reasons why the gold price could continue to surge this month, potentially even past the $4,000 per-ounce mark. Here’s what to consider:Interest rate cuts could impact the marketWhen interest rate cuts are issued, they often cause the price of gold to increase. This tends to make gold a more attractive investment option than those with diminished returns, causing investors to flock to the precious metal, causing the price to rise with it. This cause-and-effect isn’t always a sure thing, as gold has risen in price in recent years alongside both interest rate cuts and hikes. But if the Federal Reserve issues another rate cut this month, as widely expected, gold prices could respond by rising a bit closer to the $4,000 per ounce mark and, depending on how the market reacts, soon pass it to another new record.Get invested in gold before the price rises again here.Inflation is heading upwardA rising inflation rate tends to cause the price of gold to rise. And the latest inflation reading for August, released earlier this month, showed inflation headed upward. Now at a rate of 2.9%, inflation is almost a full percentage point above the Federal Reserve’s 2% goal. In this climate, when inflation erodes the purchasing power of the dollar, investors tend to move toward assets that can maintain or even grow in value. That renewed interest often helps gold’s price to rise, which could cause it to break through the $4,000 per ounce mark this month, thanks to its historic ability to hedge against inflation.Market uncertainty could cause renewed interest in safe-haven assetsThe economy is hard to predict right now. The unemployment and inflation rates are up again. But stock market performance is strong. And rates on mortgages and some other products are declining again. Against this market uncertainty, the price of gold could rise again as investors move toward safe-haven assets, of which gold is one of the more conventional ones. All it will take is movement in one of these areas to cause gold’s price to surge once again. So, if you know you need the benefits and portfolio protections gold has historically offered, it makes sense to take action promptly.The bottom lineThe conditions are right for the price of gold to not only rise but for it to grow to a new record level of $4,000 per ounce. While predicting the future price of any asset is inherently difficult to do, recent movements with this asset and the consistently rising price over the past few years make this a somewhat more secure prediction. If you want the hedge against inflation and portfolio diversification that gold can offer, then, consider exploring your gold investment options now. The price may hit the $4,000 per mark even sooner than anticipated, potentially pricing investors out of this unique market entirely.
