Gold ended 2021 the same way it did most of this year, with little movement and fluctuation somewhere around $ 1,800 an ounce.
This is in stark contrast to 2020, when the economic instability of the covid-19 pandemic drove the metal price to record highs as investors sought a safe haven for their money.
While bullion is known to be touted as a hedge against rising prices, it has failed to capitalize on this year's scalding inflation, which has been fueled by pandemic-era stimulus measures.
Spot gold is down about 4% this year, the biggest annual drop since 2015.
The strengthening of the US dollar and the threat of a pullback in stimulus from the world's largest central banks have scared off many investors who saw better opportunities in emerging equity markets.
The highs and lows of Bitcoin, considered by many to be the digital equivalent of gold, have also garnered attention.
Gold started the year under pressure, dropping 10% in the first quarter as successes in vaccines raised hopes for a quick recovery from the pandemic. Prices later recovered following the emergence of new variants of the virus and the political stalemate in the United States.
One of the key factors was the lack of interest from financial investors, which are critical to the rise in gold prices. ETFs fell nearly 9% over the year, while Comex hedge funds kept their bullion rates muted.
While the prospect of monetary tightening has made gold less attractive, prices have been supported by strong demand from Asian jewelry consumers and central bank purchases.
Opposing factors have left the bullion almost magnetically hovering around the $ 1,800 /oz mark, which is still a historically high price, but disappointing for those expecting an encore in 2020.
However, some analysts believe that the balance between buyers and sellers may not last long. An appreciation of the dollar can mean bad luck. On the other hand, signs of sustained runaway inflation may finally provide the spark needed to sustain gold growth.
BlackRock's Evie Hambro told Bloomberg earlier that gold could rally in 2022, driven by a combination of real interest rates, US dollar dynamics and demand for safe-haven assets.
However, JPMorgan analysts expect gold to come under further pressure as the global economy continues to recover and forecast an average price of $ 1,631 an ounce for next year.
Spot gold was up 0.3% on Friday to hit $ 1,821.50 an ounce by 11:40 am ET, the highest in five weeks. Meanwhile, US gold futures in New York rose 0.6% to $ 1,825.80 an ounce.