The Financial Times reported that according to Wall Street experts, gold prices are expected to continue to rise in 2025 after reaching an impressive 27% increase in 2024.
According to a survey by the Financial Times, banks and gold refiners expect gold prices to reach around $2,795 an ounce by the end of 2025, up about 7% from current levels.
The reason gold prices continue to increase is because central banks around the world are increasing their gold purchases to diversify their reserves and reduce their dependence on the USD, especially after the US imposed sanctions on Russia from 2022.
Central banks bought 694 tonnes of gold in the first nine months of 2024. The People's Bank of China also announced it would resume gold purchases in November after a six-month hiatus.
In addition, the Fed's interest rate cut helps reduce the opportunity cost of holding gold, increasing the attractiveness of this precious metal.
However, the Fed is expected to lower interest rates more slowly in 2025, which could affect the pace of gold price increases.
Geopolitical and economic factors also affect gold prices. US public debt is expected to increase under President Donald Trump's second term, leading to a weakening of the US dollar and rising inflation. This is a favorable environment for gold prices.
Conflicts in the Middle East and Ukraine continue to increase demand for safe havens.
Regarding gold price forecasts from major institutions, Goldman Sachs gave the most optimistic forecast, predicting that gold prices will reach $3,000/ounce by the end of 2025, thanks to strong demand from central banks and falling interest rates.
Heraeus Precious Metals expects gold to peak at $2,950 an ounce this year.
Barclays and Macquarie forecast more cautiously, saying that gold will fall to around $2,500/ounce, down 4% from current levels, due to pressure from the strength of the US dollar.
High fiscal spending and geopolitical uncertainty under President Donald Trump will create favorable conditions for gold, according to Michael Haigh, head of commodity research at Societe Generale, who predicts gold prices could reach $2,900 an ounce by the end of 2025.
Thus, with strong support factors from central banks, falling interest rates and geopolitical risks, gold continues to affirm its position as a "safe haven" for investors in the context of global economic and political fluctuations in 2025.
