Goldman Sachs and UBS have issued a new series of positive forecasts regarding the future of gold prices, supported by increased demand from central banks and the growing need for gold as a safe haven amid geopolitical risks and economic recession, which strengthens the likelihood of continued price increases for the precious metal through 2025.
Goldman Sachs analysts expect the price of gold to rise to $3,700 per ounce by the end of this year, with a potential reach of $4,000 by mid-2026.
UBS’s strategic analysis indicated that the price could reach around $3,500 per ounce by December 2025, based on data reflecting continued strong demand and increased interest in gold as a safe asset amidst global market disruptions.
This increase in forecasts comes after gold saw a 6.6% increase last week, hitting a new record above $3,245 per ounce, while both institutions raised their previous forecasts in March, signaling a growing consensus among major investors on the continued positive momentum in the gold market, especially amid the instability caused by global economic policies.
Goldman Sachs analysts pointed out that central bank gold purchases are expected to average around 80 tons per month this year, compared to previous estimates of 70 tons. They emphasized the importance of long-term investment in gold as a strategic option. They also highlighted that increasing recession risks could push more investors toward gold-backed ETFs.
The analysis explained that recent flows into gold ETFs were surprisingly strong, showing renewed investor interest in using gold as a hedge against economic slowdown and volatility in high-risk assets, noting that the likelihood of economic recession could reach 45%. If this scenario unfolds, these flows could accelerate, raising the price of gold to levels approaching $3,880 per ounce by the end of the year.
UBS, for its part, predicted continued strong demand for gold from various investment segments, including central banks, long-term asset managers, hedge funds, private wealth management, and individual investors, driven by changes in the global economic and geopolitical landscape, which promote a shift toward safe-haven assets.
UBS’s strategic department confirmed that the market is still far from saturation, allowing room for further exposure to gold, expecting gold holdings within fund assets to surpass levels seen in 2020, though it may not necessarily reach the peak seen between 2012 and 2013. They pointed out that the base of gold investors has expanded significantly since the 2008 financial crisis, reinforcing gold’s role as a key component in portfolio diversification.
The analysis also noted that the limited liquidity in the gold market, partly due to weak supply growth from mines, along with the large amounts of gold held by central banks and ETFs, could amplify price movements in the near future, further enhancing the likelihood of continued upward trends under current conditions.
