As the global commodity market braces for a challenging 2025, ING Group NV forecasts a bullish outlook for gold amid potential trade tensions between the U.S. and China.

What Happened: ING Group NV anticipates a difficult year for commodities in 2025, driven by possible trade tensions between the United States and China. Despite this, gold is expected to maintain its status as a safe haven, Bloomberg reported on Thursday.

The report indicates that President-elect Donald Trump's proposed tariffs could disrupt markets, impacting oil, metals, and agriculture. Traders are also monitoring China's stimulus measures, which could affect consumption. Warren Patterson and Ewa Manthey from ING noted that the commodity sector might face downward pressure with balanced supply and demand.

Gold is projected to continue its record-breaking trend, with prices averaging $2,760 an ounce in 2025. Central banks are likely to drive demand as they diversify reserves amid geopolitical tensions. The outlook for industrial metals remains uncertain, with factors like trade policies and Chinese demand influencing prices. Copper is predicted to average $8,900 a ton, while grains and soft commodities face volatility due to trade disputes and weather concerns.

Why It Matters: The anticipated performance of gold aligns with earlier predictions by JPMorgan, which foresaw significant gains for both Bitcoin and gold following Trump's presidential win. This is attributed to a "debasement trade," where assets like gold are seen as reliable stores of value amid currency devaluation.

Despite the chaotic metals market post-Trump's re-election, JPMorgan's Commodities Research team emphasized that gold's recent fluctuations are merely a "stumble, not a sea change." Meanwhile, some voices, like Michael Saylor, advocate for a shift towards Bitcoin, labeling gold as outdated. However, gold's enduring appeal as a safe haven remains significant amidst geopolitical uncertainties.

Price Action: According to Benzinga Pro, Gold ETFs have been experiencing an upward tick after Trump's win in the 2024 elections. SPDR Gold Trust (NYSE:GLD) increased by 4.54% while iShares Gold Trust (NYSE:IAU) rose by 4.52%. VanEck Gold Miners ETF (NYSE:GDX) witnessed an 8.25% rise in the past month while VanEck Junior Gold Miners ETF (NYSE:GDXJ) rose by 10.57%.

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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.

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