Gold Prices Poised for Record-Breaking Year
As economic uncertainty and inflation concerns intensify under President Donald Trump’s second term, gold prices are expected to soar to unprecedented heights in 2025. Despite a strong dollar and reduced expectations of Federal Reserve rate cuts, a poll of 36 analysts and traders predicts a median forecast of $2,756 per troy ounce of gold, up from $2,674 predicted just three months ago.
A Golden Year Ahead
Spot gold prices have already hit a record high of $2,790.15 in late October, and the average price is expected to rise significantly from $2,386 in 2024. The metal’s impressive 27% price rise in 2024 made it one of the best-performing assets of the year, as investors sought refuge in gold to hedge against global risks and the U.S. Federal Reserve’s interest rate cuts.
Geopolitical Risks Fuel Demand
“Geopolitical risks continue to simmer in various hot spots, adding to inflationary risks and driving safe-haven demand for gold,” notes independent analyst Robin Bhar. While gold prices retreated in November and December due to a post-election selloff and a Federal Reserve meeting, they have since found support from investor uncertainty over Trump’s import tariff threats and concerns about potential trade conflicts stoking inflation.
Impact on the Bullion Market
As gold prices reach record highs, some sectors in the bullion market will thrive, while others will struggle. Independent analyst Ross Norman predicts that jewellery demand will be affected in price-sensitive Asian regions, while central banks and speculative investors will remain motivated to buy gold.
Silver Prices to Benefit from Industrial Demand
Silver prices are expected to rise due to robust industrial demand, particularly in green technologies and renewable energy sectors. However, lacklustre investment demand from exchange-traded funds (ETFs) and the potential impact of tariffs on global growth could affect the metal’s prospects. According to Standard Chartered analyst Suki Cooper, “The silver market is set to remain undersupplied in 2025, but a deficit alone will not be sufficient to drive upside price risk for silver.” The poll forecasts silver prices to average $33.10 per ounce in 2025, higher than the current $30.20.
Leave a Reply