From the University Agenda

Gold prices at historic peak: Geopolitical risks play decisive role

Accumulators and investors who closely follow gold prices are wondering how long the fluctuations in the market will last. Explaining the subject, Assoc. Prof. Hakan Yıldırım said that the biggest reason for the changes in gold prices is global developments.

Istanbul Gelişim University Lecturer Assoc. Prof. Hakan Yıldırım stated that global economic and geopolitical factors are decisive in these movements. The 52-week exchange interval of gold was between 1,984.3-2,790.41 dollars, and that the increasing geopolitical risks, particularly in 2024, were effective in reaching historical peaks in gold prices.

Gold prices have strengthened with the Russia-Ukraine war, increasing uncertainties in the Middle East and the fluctuations brought by the US elections, Yıldırım also added, "Ounces of gold are priced at $2,617 in recent days. The removal of US election uncertainty and the Fed's reduction in interest rates from July have created a mixed picture in price movements. " Emphasizing that this situation has caused gold prices to follow a horizontal course in the recent period, Assoc. Prof. Yıldırım stated that the ounce gold price can test $2,676 in the short term according to market forecasts, and if this level is exceeded, it can rise to $2,725.
If the trend shows a downward movement, prices can be pulled to the level of $2,600. Analysts expect gold prices to be between $2,421 and $2,651 in the long term for 2025, and that prices can reach $3,000 if geopolitical risks continue.
 
Developments in the Middle East and the US affect gold prices

Assoc. Prof. Yıldırım emphasized that the recent developments in the Middle East and the USA also have a direct impact on gold prices. Stating that growth indicators and unemployment rates in the US economy shape the Fed's interest rate policies, he also said, "In periods of economic stability, while investors turn to riskier assets, this may reduce the value of gold. However, concerns about economic contraction or recession cause gold prices to rise."
Assoc. Prof. Yıldırım stated that the uncertainties in the US foreign policy and trade wars affect the value of the dollar, which creates a serious pressure on gold prices. "Since gold is traded in dollars, changes in the value of the dollar directly affect gold prices," Yıldırım said, noting that especially the turmoil and uncertainties in the Middle East may also have an effect on increasing gold prices.

Safe haven against inflation: Gold

Pointing out the critical share of the Middle East in world oil production, Yıldırım said, "The instabilities in the region may cause sudden increases in oil prices. While this creates inflationary pressures, it can lead investors to gold as a safe haven. As long as gold continues to be seen as a means of protection against inflation, it can have an uplifting effect on prices.”
Assoc. Prof. Yıldırım stated that gold will continue to be affected by uncertainties in the short term, but it can continue its upward trend in the long term depending on geopolitical and economic balances.