Gold Gains: A Familiar Bull Run With a New Twist
- The price of gold has been on a tear for the past several years.
- The metal has experienced three major bull markets since 2000.
- Is the current rally just getting started or nearing its climax?
Gold has been on a tear. The price of the yellow metal surged past $3,400 per ounce earlier this week, bringing its year-to-date gain to a jaw-dropping 30%. That follows a 27% jump in 2024 and a 13% rise in 2023—a three-year run few assets can match.
But as remarkable as this rally has been, it’s not without precedent. Since 2000, gold has gone through three major bull markets.
Putting the Gold Rally in Perspective
The first began in the early 2000s, catalyzed by the launch of gold-focused ETFs like the SPDR Gold Trust (GLD), a shift by central banks from being net sellers to buyers and booming demand from India and China—which together account for half of the metal's global consumption.
That rally ended a two-decade bear market that had started in 1980, when central banks crushed inflation and the precious metal fell out of favor.
From the turn of the century to the 2011 peak, gold climbed nearly 7×, topping out near $1,900 per ounce.
But nothing goes up forever. What followed was a nearly decade-long slump, which entailed a grinding 45% drawdown and consolidation period driven by a cooling Chinese economy and fading enthusiasm for commodities in general.
The price eventually bottomed out near $1,000 per ounce and slowly clawed its way back. Then in 2020, the Covid-19 crisis lit a fire under the metal. Fueled by unprecedented monetary and fiscal stimulus, inflation soared—and so did gold, which doubled from its 2015 lows to over $2,000.
Post-Covid inflation triggered aggressive rate hikes, briefly pausing gold’s momentum. But this time, the pullback was milder—only about 21%, and the price bottomed around $1,600 in 2022.
That correction set the stage for the latest breakout. As prices sagged, central banks became voracious buyers of the metal. And more recently, growing skepticism toward the U.S. dollar and dollar-based assets has drawn in even more demand.
Since its 2022 lows, gold has more than doubled, matching the explosive gains of the last bull market.
The big question now is whether this rally is just getting started or nearing its climax.
