GOLD is expected to average $2,795 per ounce this year continuing the gains of last year, said the Financial Times.
Purchases of the metal will be driven by central bank buying and the Donald Trump presidency which is expected to raise US debt levels and weaken the dollar. Inflation is also expected to increase.
“Whatever he announces will increase debt, leading to a weaker dollar and increased inflation. That is usually a nice mixture for gold,” said Henrik Marx, global head of trading at Heraeus Precious Metals, which forecast that gold could touch highs of $2,950 per troy ounce this year.
The Financial Times said that the most bullish forecast on the gold price was by Goldman Sachs. It expects prices to reach $3,000 by the end of 2025 citing central bank demand and expected rate cuts by the Fed.
The most bearish forecasts were from Barclays and Macquarie, which both expect gold to sink to about $2,500 per troy ounce by the end of the year — a roughly four per cent drop from current levels, said the newspaper.
“Our base case into 2025 is for gold to initially face ongoing pressure from US dollar strength, but be supported by improved physical buying and steady official sector demand,” wrote Macquarie analysts in its year-end outlook
An average of $2,795/oz will represent a seven per cent increase over last year when the metal rose 27% in value. Central bank purchases flattened last year after emerging market banks drove the price hard with buying in 2022. The People’s Bank of China announced in November that it was resuming gold purchases after a six-month hiatus.
Conflicts in the Middle East and Ukraine are also forecast to lift prices are also expected to give lift to gold.
