BANGKOK – Market analysts remain upbeat about gold, with many predicting prices could hit $3,700 per ounce by the end of 2025 and possibly climb toward $4,000 within the next three to five years.
This confidence comes from ongoing concerns around global conflicts, financial uncertainty, and changes in central bank strategies. With markets unsettled by events like the Russia-Ukraine war, strained US-China relations, and unpredictable US policies, gold stands out as a safe option for those seeking stability.
The Russia-Ukraine conflict continues to drive demand for gold. Since tensions flared, markets have dealt with energy shocks and disrupted supply chains. These issues have raised fears of economic slowdowns, making gold more attractive as a store of value.
Sanctions on Russia have added pressure, leading some countries to rethink their reliance on the US dollar. Instead, many are turning to gold to safeguard their financial reserves.
Strained relations between the US and China also add to market uncertainty. Trade disputes, bans on certain technologies, and military moves in the South China Sea have left investors uneasy.
The introduction of new tariffs and tighter export rules has sparked worries about global trade. China’s move to increase its gold reserves shows a preference for tangible assets in these uncertain times. These ongoing disputes support gold demand, pushing up prices as investors anticipate more instability ahead.
Trump’s Policy Moves Add Volatility
Donald Trump’s return to the White House has brought renewed swings in financial markets. His past unpredictable trade decisions, tax changes, and moves to ease regulations have traders preparing for more surprises. New tariffs, especially on Chinese goods, could lead to higher costs, putting pressure on the dollar and making gold more appealing.
Trump’s skepticism about international institutions and focus on domestic priorities may strain global ties, adding to geopolitical risk. Many traders say these factors could drive gold up to $3,700 by the end of the year.
Analysts also point out that Trump’s potential fiscal changes could increase US debt, which might weaken confidence in the dollar. With inflation worries still present and possible interest rate cuts coming, real returns on US government bonds may stay low, giving non-yielding assets like gold an advantage.
Michael Langford, chief investment officer at Scion Capital, puts it plainly: “Trump’s unpredictability works in gold’s favour. Each new announcement or threat sends investors towards safer options.”
Central Banks Ramp Up Gold Buying
Central banks have become major players in gold’s rise. In 2024, they added over 1,000 metric tons to their reserves, matching record levels from 2022. China, India, and Turkey led this trend, with Russia quietly building its holdings despite sanctions. This reflects a broader move away from dollar-based assets, as emerging markets try to protect themselves from currency swings and future sanctions.
There’s also been a push for countries to bring their gold reserves back home, seen in moves by Germany, Poland, and Hungary. This shift points to a desire for more control over national wealth as global risks rise. Sarah Klein, a commodities strategist at Global Markets Advisory, notes that central banks are rethinking their entire reserve approach, not just buying more gold.
Dedollarisation plays a part here too. As the US uses the dollar in sanctions, more countries are choosing gold to reduce their exposure to the US financial system. With the BRICS group looking at alternatives to the US dollar, gold’s profile as a neutral asset is growing. Traders believe this trend will keep supporting gold prices, making $4,000 per ounce a realistic target over the next few years.
Technically, gold has built strong upward momentum. After passing $2,500 in 2024, the metal has held above its 50-day moving average. Resistance is now forming near the $3,000 mark. Gold-backed ETFs, such as SPDR Gold Shares, have recorded a 15% rise in holdings since the start of the year. Futures markets also show a clear tilt towards buying, showing strong confidence among traders.
Demand for Gold in Asia
Physical demand, especially across Asia, continues to support higher prices. India’s festive season and steady retail buying in China have kept premiums high. At the same time, supply remains tight, with production held back by depleted mines and tougher environmental rules. Sarah Klein points out, “Production isn’t growing, but demand is. That’s why many see $3,700 as just the beginning.”
While the outlook for gold is strong, some risks remain. A stronger US dollar due to tighter Federal Reserve policy could slow gold’s rise. If global tensions were to ease, there might be less urgency for safe-haven assets.
Some traders also warn that a sudden shift in sentiment could lead to short-term drops, but most agree the long-term case for gold remains solid.
Gold’s path to $4,000 per ounce depends on a mix of global and economic factors. The ongoing Russia-Ukraine war, continued US-China disagreements, and the unpredictability of US policies all add uncertainty.
Central banks’ buying habits and moves to bring gold reserves home provide further support. As uncertainty lingers, gold remains a popular choice for those looking to protect their wealth. For investors, the message is clear: in uncertain times, gold is seen as a steady anchor.
