Gold’s quiet comeback
Gold has been among the best performing assets this year and could continue rising.

Gold has made an unheralded, but impressive comeback this year following a 30% drop in 2013. It has risen by over 9%, beating commodities, bonds and UK equities. It hit a four-month high of around $1,340 last month as the eurozone crisis briefly flared up again. Further gains look likely over the next few years.
Gold struggled last year as the US Federal Reserve began to taper' the amount of money it was printing. The prospect of even mildly tighter US monetary policy was seen as bad news for an asset that thrives on fear, bad news, and the threat of inflation. But tapering is now "priced in", reckons Citigroup.
With interest rates still at historic lows, fears of eventual inflation have hardly gone away. And the longer rates stay low, the greater the risk of bubbles forming and bursting, adds Bank of America Merrill Lynch (BAML), a worry that may bring new buyers into the market.
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The appetite for gold from central banks and increasingly wealthy consumers in emerging markets remains healthy. Demand for gold jewellery has just recorded its best first quarter since 2005, according to the World Gold Council.
Throw in a wide range of geopolitical jitters, and it's no wonder BAML sees gold averaging $1,375 next year, up from $1,308 in 2014.
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Andrew is the editor of MoneyWeek magazine. He grew up in Vienna and studied at the University of St Andrews, where he gained a first-class MA in geography & international relations.
After graduating he began to contribute to the foreign page of The Week and soon afterwards joined MoneyWeek at its inception in October 2000. He helped Merryn Somerset Webb establish it as Britain’s best-selling financial magazine, contributing to every section of the publication and specialising in macroeconomics and stockmarkets, before going part-time.
His freelance projects have included a 2009 relaunch of The Pharma Letter, where he covered corporate news and political developments in the German pharmaceuticals market for two years, and a multiyear stint as deputy editor of the Barclays account at Redwood, a marketing agency.
Andrew has been editing MoneyWeek since 2018, and continues to specialise in investment and news in German-speaking countries owing to his fluent command of the language.
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