“Goldman Sachs predicts that the price of gold may reach $3,000 per ounce next year, as central banks around the world continue to buy gold in large quantities. The bank also believes that gold is the preferred trade to deal with inflation and geopolitics in 2025.
Financial Associated Press, November 25th (Editor Huang Junzhi) Samantha Dart, co-head of commodity research at Goldman Sachs, stated that with central banks around the world continuing to buy gold in large quantities, the price of gold may reach $3,000 per ounce next year.
Since the beginning of this year, the price of gold has risen significantly, up 30% compared to January. Last week, the international gold price rose for five consecutive days, with a cumulative increase of nearly 6%, marking the largest weekly increase since October last year. At the close, COMEX gold futures rose by 1.62% to $2,718.2 per ounce. Dart's forecast suggests that the price of gold will rise by over 10%.
"This growth will be mainly driven by central bank purchases. Compared to the average level before 2022, the amount of gold purchased by central banks worldwide has expanded fivefold," she said.
Data from the World Gold Council shows that in the last quarter, central banks around the world bought more than twice the amount of gold compared to the same period last year, reaching 186 tons. The organization stated in a report in October that since the beginning of this year, central banks around the world have bought 694 tons of gold.
"Since 2022, this has been a major driver of the gold market," Dart said in a recent interview. "The moment Russia's financial assets were blocked, it triggered concerns in many emerging markets. Therefore, the purchasing power of central banks has significantly increased."
Dart stated that emerging market economies may continue to buy gold rapidly next year, as many countries in these markets still have "very low" gold reserves compared to developed economies.
On the other hand, Dart also mentioned that the price of gold may also be supported by bid from ETFs. She pointed out that in times of increasing economic and geopolitical uncertainties, many traders are turning to ETFs for support.Its price has soared to a historic high, closely related to market expectations of interest rate cuts by the Federal Reserve.Interested.
According to data from the World Gold Council, global gold demand reached 1,313 tons in the third quarter, valued at over $100 billion, hitting a historical high. At the same time, investment demand for gold in the previous quarter more than doubled year-on-year, reaching 364 tons.
"'Safe haven' is just icing on the cake," Dart said. "There is a lot of policy uncertainty in the future. Clients have always been very concerned, will tariffs escalate? This may bring uncertainty, which usually triggers higher positions."
Overall, Goldman Sachs believes that "the surging dollar is no longer a stumbling block to gold prices continuing to rise," and considers gold to be the "preferred trade" to deal with inflation and geopolitical issues in 2025, seen as the preferred asset against subsequent risks such as tariff escalation and concerns over U.S. debt default.
Not only Goldman Sachs, other Wall Street forecasters are also looking to the record-high gold prices next year. Senior commodity analyst and founder of CPM Group, Jeffrey Christian, predicts that the price of gold will reach a historic high by the end of January next year.
In a recent report to clients, he speculates that gold may remain stable for several months before rebounding to cyclical peaks by 2026, meaning that in the first year of the Trump administration, gold will set multiple historical highs.
Citigroup predicts that by mid-2025, the price of gold may reach $3,000, citing "geopolitical heat" and demand for safe-haven assets.
