2005 Market Review & Yearly Summary [Gold & Other Precious Metals]

Looking back to 2005 it was a significant year for the precious metal industry especially since gold prices according to most analysts were expected to pass the US $750 mark the following year and based on their arguments and facts, there was no reason to doubt it.  The fact that gold prices rallied the previous year and surpassed the 540 US mark in December the precious year an increase of 25 %, gold was at its highest point in nearly a quarter of a century. However, looking at the prices of gold from a much broader perspective as in the averages the average price of gold was on USD 444. The average gold price for each quarter was as follows:

Q1 $427
Q2 $427
Q3 $439
Q4 $485

Dwelling into the matter of gold prices even deeper, one could not help but notice that that gold prices were at their peak towards the end of each quarter with an average price increase of $49 for each troy ounce. The bull market for gold which began in 2001 had the biggest surge in 2005 (biggest annual dollar increase), that saw prices for the precious metal increase by over $80US. Nevertheless, this was only the 3rd biggest increase in percentage terms.

Gold prices in Euros even made larger gains with increases that reached nearly 35 % in 2005, whereas the Japanese Yen Gold Prices went up close to 36 % in the same year. The most unconventional observation made in 2005 was the fact that gold price, which conventionally moves in the opposite direction of the greenback movement increased along with the dollar when the dollar went up by 15 % against the euro. Another factor worth noting was that gold prices broke out from all major currencies. Thus, it can be said that the unorthodox gold price movement in 2005 was a sign of the impending economic meltdown that the world suffered from in the following years.