- Gold prices climb another 1%, extending a historic rally fueled by geopolitical tensions and central bank buying.
- The $3,000/oz milestone was shattered in March, with prices peaking at $3,498 in April—analysts see further upside.
- Major banks like Goldman Sachs and J.P. Morgan project gold could reach $3,700-$4,000/oz by late 2025 or early 2026.
Gold’s Unrelenting Rally Continues
Spot gold rose 1% to $3,354.84 per ounce, marking another high in a record-breaking rally that has defied expectations. The precious metal has gained over 25% year-to-date and more than 43% compared to June 2024 levels, as investors and central banks pile into the safe-haven asset amid escalating global uncertainty.
Central banks, particularly those in emerging markets, have been aggressive buyers, seeking to diversify reserves away from the U.S. dollar. Geopolitical flashpoints—from the ongoing war in Ukraine to U.S.-China trade tensions—have further bolstered demand. 'This isn’t just a short-term flight to safety; it’s a structural shift,' said one London-based metals trader, who asked not to be named discussing market dynamics.
The Macro Backdrop
With major economies signaling potential rate cuts later this year, gold’s appeal as a non-yielding asset has grown. ETF inflows have surged, and even retail investors are increasing exposure through bullion and digital gold products. 'The fear trade is alive and well,' noted an analyst at a European investment bank. 'Until we see stabilization in geopolitics or a hawkish pivot from central banks, gold has room to run.'
Goldman Sachs recently raised its year-end target to $3,700/oz, while J.P. Morgan sees prices climbing toward $4,000/oz by mid-2026 if current trends hold. Not everyone is bullish, however. Some warn that a sudden de-escalation of conflicts or stronger-than-expected economic data could trigger profit-taking. For now, though, the path of least resistance appears upward.