The report points to gold’s unique role as a hedge against financial instability and geopolitical risks. The price of gold, expressed in US dollars, has already increased by over 20% this year. Further growth could be fuelled by the Federal Reserve (Fed) lowering interest rates and central banks in emerging markets buying gold.

Goldman Sachs argues that the anticipated rate cut could see the gold market lure back Western capital, which has not yet fully exploited the recent rise in the price of gold. Gold could get an additional boost if the US imposes new financial sanctions or if concerns mount about the US debt burden.

The bank’s strategists rate gold as the commodity most likely to experience further growth. It is also their preferred hedge against geopolitical and financial risks.