(Kitco News, Tues. June 20th, 2023)– The global precious metals market will reach $403.1 billion by 2028 and be led by the gold sector, according to India-based consultancy firm Fortune Business Insights. This is up from 2021’s $275 billion.
Between 2021 and 2028, the precious metal market’s compound annual growth rate (CAGR) is estimated to be at 5.6%, the firm said in its report released in June.
Gold will play a vital role in the growth of the precious metals market. “The increasing investments in a commodity such as gold due to its low-risk factor compared to other investments such as equities, bonds, or real estate are fueling the market,” Fortune Business Insights said. “The perception of gold as a status symbol and safe haven for investment has significantly contributed to the growth of the market. As, to avoid the risk … investors regularly flock towards gold as an asset that will maintain its value.”
The investment side is projected to be the fastest-growing segment between 2021 and 2028. “The increasing investments in a commodity such as gold due to its low-risk factor compared to other investments are augmenting the segment growth,” the report said.
The report also highlighted jewelry demand as one of the key drivers. “Increasing disposable incomes and changing lifestyle choices are a few of the factors driving the market. The demand for these metals is estimated to propel globally for jewelry, and investment applications as gold and silver are of prime importance in wedding ceremonies of Southeast Asian countries,” the report said. “Therefore, the rising population and increasing spending capacity of consumers in the region will contribute to market growth.”
Silver is the metal that will benefit the most from the expanding electrical and electronics industry. In the meantime, platinum group metals will be driven by auto-catalyst applications.
“The automotive industry is the major consumer of platinum and palladium, with primary application in the catalytic converter,” the report said. “Additionally, the growing awareness about environmental pollution and changing regulations regarding carbon emissions from vehicles will substantially boost the demand for metals of the platinum group for application in catalytic converters.”
Not all research firms share such an optimistic outlook. IMARC Group said that the global precious metals market reached $198.5 billion last year and is set to expand to $267.5 billion by 2028, with a CAGR of 5.49% between 2023 and 2028.
“The rising investments in precious metals, increasing utilization of precious metals in a variety of industrial applications, and the growing adoption of precious metals to mint coins represent some of the key factors driving the market,” IMARC Group said.
Research Reports World estimated the global precious metals market to reach $316.6 billion in 2030, with CAGR of 5.32%.