Prediction: International gold price will rise to $3,000/ounce in 2025

In 2024, gold is very shining. According to the World Gold Council, the international gold price hit a record high 40 times in the past year, with an increase of 28.2% during the year, the largest annual increase since 2009. When looking forward to 2025, most institutions said in their annual outlook reports that they are still optimistic about the future of gold. Among them, several analysis institutions including JPMorgan Chase, Goldman Sachs, Citibank, Bank of America, etc. predicted that the international gold price will rise to $3,000/ounce in 2025.

However, after entering 2025, analysts at Goldman Sachs lowered their expectations for the international gold price in 2025 in their latest report released on January 6. The group’s analysts pointed out that since the Fed’s interest rate cut in 2025 may be less than market expectations, they lowered the international gold price target of $3,000/ounce at the end of 2025 to $2,910/ounce, and expected that the gold price would not reach the level of $3,000/ounce until mid-2026. With the change of the US inflation trend, the market’s expectations for the Fed’s interest rate cuts have been constantly adjusted. The slowdown in the decline of US inflation may cause the Fed to adopt a more cautious interest rate cut strategy in the future, resulting in the dollar remaining strong, which directly affects the demand and attractiveness of gold. Usually, the US dollar and gold prices show a significant negative correlation.

On the other hand, Goldman Sachs analysts pointed out that the central bank’s demand for gold purchases will become an important factor supporting gold prices in 2025 and 2026. “Against the backdrop of global economic uncertainty and increased geopolitical risks, the gold purchase behavior of central banks is particularly important.” In the long run, Goldman Sachs expects that by mid-2026, the average monthly gold purchases of central banks will reach 38 tons, which will to some extent support the gold price to reach $3,000/ounce during this period.