KUALA LUMPUR (BERNAMA) – Gold price is on fire! The precious metal continues to defy expectations, repeatedly smashing record highs as investors seek refuge from global economic turbulence.
To recap, on October 30, 2024, gold surged to an all-time high of USD2,787.61 per troy ounce before settling at USD2,693.23 per troy ounce in January 2025.
Now, the gold has breached USD3,000 per troy ounce to stand at USD3,036.74 per troy ounce as of March 20, 2025, according to the goldprice.org data. The burning question is: how high can it go?
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid pointed to one key factor – uncertainty.
“Whenever fear grips the global economy, gold shines the brightest. It is not just a store of wealth but also a hedge against inflation, currency devaluation and geopolitical instability,” he told Bernama, adding that the numbers prove it.
He pointed out that central banks worldwide have been aggressively stockpiling gold, increasing their share of total demand from a mere 1.8 per cent in 2010 to a staggering 21.0 per cent in 2024.
“This rapid accumulation – growing at a 20.2 per cent annual rate – has pushed gold prices higher.
“Against such a backdrop, gold prices would remain constructive for the foreseeable future. However, as in any asset class, it will be subjected to price fluctuation due to changes in market sentiments and risk appetite,” he added.
Meanwhile, he further explained that the Global Economic Policy Uncertainty Index soared to 339.36 points in November 2024, reflecting growing concerns over the United States Federal Reserve policies, trade tensions and political instability under Donald Trump’s second term.
“Historically, whenever economic uncertainty spikes, gold prices follow suit,” he added.
OTHER COMMODITIES: RISING BUT LAGGING BEHIND GOLD
While gold steals the spotlight, other commodities have also experienced significant price movements.
From the writer’s observation, cocoa, for instance, surged to a 50-year high in 2024, with prices reaching USD12,906 per tonne in December 2024, primarily attributed to adverse weather conditions and underinvestment in major cocoa-producing regions, leading to reduced yields and supply constraints.
As of March 20, 2025, cocoa prices stood at USD7,746.3 per tonne (according to the tradingeconomics website), indicating a slight decrease but remaining elevated compared to historical levels.
Oil prices have also been volatile. On March 20, 2025, Brent crude edged up 0.2 per cent to USD71.78 per barrel, driven by instability in the Middle East and China’s stimulus measures to bolster its economy.
Despite these fluctuations, oil prices have not mirrored the unprecedented surge observed in gold.
Coffee prices, meanwhile, have shown significant volatility, reflecting shifts in global supply chains and changing consumer demand patterns.
The price of Arabica beans reached nearly USD3.50 per pound in December 2024, marking its highest level since 1977, marking a staggering 83 per cent increase in 2024.
In the palm oil sector, a significant commodity for Malaysia, palm oil has experienced price fluctuations in recent years.
After reaching an all-time high of MYR7,268 per tonne in March 2022, palm oil prices have decreased by MYR246 per tonne, or 5.54 per cent, since the beginning of 2025.
GOLD PRICES CONTINUE ITS METEORIC RISE: WHAT IT MEANS FOR MALAYSIANS?
For Malaysia, the gold rush has both winners and losers.
On the bright side, gold jewellery remains a cultural staple, especially among women and those leveraging Ar-Rahnu (Islamic pawn broking), said Mohd Afzanizam.
“The rising popularity of gold-based investments has also driven more Malaysians to diversify their portfolios.
“However, sky-high prices are making gold less accessible for many consumers. We might see a shift toward alternative investments or even lower-cost jewellery options,” he said.
For Malaysians sitting on gold investments, the big dilemma remains – cash out now or hold for bigger gains?
Mohd Afzanizam said, “It depends on your financial goals. If you are investing for retirement, holding onto gold may be wise. But if you are trading, timing is everything.”
OUTLOOK: WILL GOLD HIT USD5,000?
Some speculators predicted that gold would soar to USD5,000 per troy ounce by year-end, but Mohd Afzanizam remained cautious, saying that value may take three to five years to rise.
“A more realistic target would be between USD3,000 per troy ounce and USD3,500 per troy ounce in the next few years.
“Honestly, it is hard to predict gold prices as they tend to break their all-time high records multiple times,” he said.
Meanwhile, Malaysia’s jewellery industry is adapting to the new landscape by focusing on innovation and diversification, said Ng.
“Industry players are expanding their offerings, incorporating alternative materials, and exploring new markets to remain competitive in an environment where gold prices continue to rise.
“Among the current design trends and consumer preferences include minimalist and lightweight designs and alternative materials,” he added.
