Will 2023 be a good year for investing in gold?
Anyway, it got off to a pretty good start.
The price of gold rose in the first few days of the new year, temporarily reaching around $1,880 a troy ounce (31.1 grams) on Monday.
That was the highest level since June last year.
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The justification on the markets draws attention to what the further development of the gold price this year is likely to depend to a large extent: the future monetary policy of the central banks - especially the American Federal Reserve.
"American economic data have recently dampened concerns about further aggressive rate hikes by the US Federal Reserve," said Alexander Zumpfe, gold trader at the precious metals group Heraeus.
This not only boosted the stock markets, but also put the dollar under pressure – but a weak greenback traditionally supports the price of gold.
How should things continue now, with the price of the precious metal?
Last year, the price of gold in dollars roughly held its level; in euros, there was even an increase of a good 5 percent over the year due to the change in the exchange rate against the dollar.
Still, given record-high inflation and significant geopolitical risks, that was a rather weak result for the troubled currency.
Analysts cited the global turnaround in interest rates as the most important reason, which made non-interest-bearing gold less attractive compared to other investments.
This year, the first central banks could start to take a break from raising interest rates.
That could benefit the interest-free gold.
But all this is still very uncertain: Karsten Junius, economist at Bank J. Safra Sarasin, believes that the Bank of England will be the first to pause, followed by America's Fed - and only then the European Central Bank (ECB).
Average $1862 an ounce expected
In any case, in a survey by the FAZ of around two dozen financial institutions, most were somewhat skeptical about the further development of the gold price this year.
The average estimate is $1,806 mid-year and $1,862 at the end of the year.
That would be even below the current price.
The Düsseldorf bank IKB gave the lowest forecast of 1,450 dollars at the end of the year.
The ETF provider iMaps ETI ventured the highest estimate – he expects $2,400 in the middle of the year and $2,600 by the end of the year.
If that were to happen, it would be a historic high for gold: the previous record from the August 2020 crisis was $2,075.
Goldman Sachs confident in gold
The American investment bank Goldman Sachs considers at least 1950 dollars in twelve months possible.
This makes it significantly more optimistic about the development of the gold price than most local banks.
Last year, however, Goldman had at times announced that the price of gold would rise to $2,500 due to inflation – but that never happened.
On the other hand, the precious metals group Heraeus expects a new gold price record this year, at least in euros: The previous high from March 2022, shortly after the start of the Ukraine war, was 1870 euros per troy ounce.
Meanwhile, the industry organization World Gold Council (WGC) reports further major gold purchases by central banks in November.
"The biggest announcement of the month came from the People's Bank of China, which reported a 32-ton increase in gold reserves," writes the Council in its regular review.
Turkey has also continued its gold purchases and increased the official reserves of the central bank and treasury by a further 19 tons.
The country increased its gold reserves by 123 tons to 517 tons last year up to and including November.
That was the highest net gold purchases reported by any country.
"The central bank sector as a whole has been one of the notable drivers of the gold market in 2022," said Council Analyst Krishan Gopaul.
On the other hand, while gold-backed securities struggled with outflows of 110 tons over the course of the year, demand from private investors for physical gold in the form of bars and coins remained high, especially from Germany.
In the third quarter alone, Germans bought 42 tons of physical gold – that was 25 percent more than in the same quarter last year.
In Turkey, 47 tons were bought in the same period - that was even five times the amount.
Many gold fans point out that real interest rates – i.e. interest rates after deducting inflation – are likely to remain negative for the foreseeable future despite the turnaround in interest rates.
That speaks for an investment in tangible assets such as stocks or gold.