Global major banks expect that due to continued geopolitical uncertainties affecting investor sentiment, the price of gold will remain high throughout 2025, possibly reaching $3,000 per ounce.
The latest rebound in gold prices is primarily driven by the new round of trade war between the United States and China, as well as the tariff disputes involving the United States, Canada, and Mexico.
According to Reuters on Thursday, Citigroup has raised its short-term (0-3 months) gold price target from $2,800 to $3,000 per ounce due to the evolving situations, while maintaining the 6-12 month forecast at $3,000, consistent with the previous prediction. Citigroup also adjusted its average price expectation for 2025 from $2,800 to $2,900 per ounce.
In a report, Citigroup stated, “Under Trump 2.0 leadership, the gold bull market may continue. Trade wars and geopolitical tensions will strengthen the trend towards diversification/de-dollarization of reserves, support gold demand from official sectors in emerging markets, while global growth concerns will increase ETF and OTC investment demand.”
However, US Treasury Secretary Scott Bessent stated on Thursday that the “strong dollar” policy will continue under President Trump’s leadership.
“We want a strong dollar,” he added. “We also do not want to see other countries manipulate trade by devaluing their currencies.”
Citigroup Bank stated, “We expect gold to continue rising to hedge against growth and other risks, including rising risks of actual and perceived growth, such as trade wars, persistently high interest rates hindering growth, continuing deterioration in the US labor market, currency devaluation risks outside the United States, and the potential risk of a downturn in US stocks.”
At the same time, data from the World Gold Council shows that global gold demand increased by 1% in 2024, reaching a record 4,974.5 tons, driven by increased investments and central bank purchases in the fourth quarter.
In a report dated December 5, 2024, Macquarie Bank of Australia stated, “Although economic growth should remain strong in the first half of 2025, the outlook thereafter largely depends on the timing and strength of US fiscal, trade, and immigration policies, as well as the extent of tariff retaliations.”
Goldman Sachs Bank expects gold prices to surpass $3,000 by the second quarter of 2026; UBS Bank predicts gold prices to break $3,000 by the end of 2025; and JPMorgan Chase anticipates an average gold price of $2,863 for this year, rising to $3,019 next year.
With the continuous upward trend in gold prices, it hit a historic high of $2,882.16 on Wednesday. The momentum of gold rising for five consecutive trading days is driven by escalating trade tensions among major economies, heightened concerns about economic growth, and uncertainty surrounding the Federal Reserve’s interest rate path.