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Highlights
- Gold forecast lifted to $US3600 per ounce by year-end
- Economic uncertainty and inflation support the rally
- Price momentum mirrors historic gold boom of the 1970s
Gold continues its upward trajectory, with updated forecasts now suggesting it could reach $US3600 an ounce by the end of 2025. This bullish outlook comes amid a convergence of global economic conditions that echo some of the most significant rallies in the metal’s history.
The upgraded outlook is driven by a mix of rising global uncertainty, persistent inflation concerns, and growing expectations of interest rate cuts. These elements have historically served as strong catalysts for gold, and current market dynamics appear to be creating a similar environment.
Analysts note that comparisons are being drawn to the massive gold rally of the 1970s and 1980s. Back then, a volatile mix of high inflation, slowing economic activity, and geopolitical instability pushed gold prices to an all-time high of $US850 per ounce. Adjusted for inflation, that historic high equates to approximately $US3483 in today's terms — a level that gold is now fast approaching.
As of the latest session, gold briefly climbed above $US3230 an ounce, coming within striking distance of its all-time high. The momentum has been building throughout the year, and this recent surge underscores the growing appetite for safe-haven assets.
According to commodity strategist Soni Kumari, current macroeconomic conditions form a “perfect backdrop” for continued strength in gold. With inflationary pressures persisting and global growth appearing to soften, investors are increasingly looking toward assets that have historically held their value during periods of economic turbulence.
The anticipation of central banks easing monetary policy further fuels the narrative. Lower interest rates tend to enhance the appeal of non-yielding assets like gold, which becomes more attractive relative to interest-bearing investments during such periods.
This evolving scenario has also influenced the market valuations of companies involved in the gold sector. Firms like Newmont Corporation (NYSE:NEM), Evolution Mining (ASX:EVN), and Northern Star Resources (ASX:NST) are closely watched as beneficiaries of rising gold prices.
While gold may not yet have reached its inflation-adjusted peak from the previous century, the trajectory suggests it could continue its ascent if current conditions persist. With demand supported by economic and geopolitical factors, gold’s role as a traditional store of value is once again coming to the forefront.
As the year progresses, all eyes remain on macroeconomic indicators and how they might shape the path ahead for this glittering asset.
