2025 Gold Market Outlook: Where Will the Price Trend Go?

Entering 2025, the global investment market is experiencing increased volatility, and gold has once again become a market focus. After months of continuous gains, gold prices have adjusted as they approach the historic high of $4,400 per ounce, but market attention to gold remains high. Many investors are asking: Will the gold rally continue? Is now the right time to enter?

To answer these questions, we first need to understand the fundamental logic driving gold price movements.

How do professional institutions view the future trend of gold?

Against the backdrop of market adjustments, major global financial institutions are surprisingly consistent in their outlook on gold—optimistic.

J.P. Morgan Commodity Research Team considers this correction a healthy technical adjustment and has raised its Q4 2026 target price to $5,055 per ounce.

Goldman Sachs Group also maintains an optimistic stance, reaffirming their forecast of $4,900 per ounce by the end of 2026.

Bank of America Strategy Team is even more bullish, setting a 2026 target price of $5,000 per ounce and boldly predicting that gold could break the $6,000 per ounce barrier next year.

Domestic jewelry brands such as Chow Tai Fook and Luk Fook Jewelry also offer stable pure gold jewelry prices above NT$1,100 per gram, with no significant decline observed, indirectly confirming market recognition of gold’s value.

Three core drivers behind the rapid rise of gold

Over the past two years, gold has continued to climb, with the increase from 2024 to 2025 approaching the highest in nearly 30 years, surpassing the 31% rise in 2007 and the 29% in 2010. This rally is not accidental but the result of multiple factors stacking up.

First driver: Policy uncertainty fueling safe-haven demand

At the start of the new year, a series of new trade policies have led to a significant increase in international market risk premiums. Historical experience (such as the US-China trade friction in 2018) shows that during periods of policy uncertainty, gold prices typically rise 5-10% in the short term. When risk aversion is high, gold, as a traditional safe-haven asset, naturally becomes the preferred destination for capital.

Second driver: Real interest rates and monetary policy expectations

The Federal Reserve’s rate cut decisions have a clear negative correlation with gold prices—lower interest rates usually lead to higher gold prices. This is because gold itself does not generate income, and when nominal interest rates decline, the opportunity cost of holding gold decreases, making it more attractive.

According to the latest data from CME interest rate futures, the probability of a 25 basis point rate cut at the next Fed meeting has reached 84.7%. This explicit rate cut expectation directly supports market confidence in rising gold prices.

Third driver: Continued accumulation by global central banks

According to the World Gold Council, net gold purchases by central banks worldwide reached 220 tons in Q3 2025, a 28% increase quarter-over-quarter. In the first nine months, total gold purchases amounted to approximately 634 tons, slightly lower than the same period last year but still at a high level. Notably, in the council’s latest survey, 76% of respondent central banks indicated they plan to increase their gold reserves over the next five years, while also expecting to reduce their dollar reserve ratio. Strategic accumulation by central banks provides long-term support for gold prices.

Auxiliary factors driving gold higher

Besides the three core drivers above, other factors are also at play:

High global debt and slowing economic growth

By 2025, global debt has reached $307 trillion. The high debt environment limits policy maneuvering space for countries, prompting monetary easing, which indirectly boosts gold’s safe-haven appeal.

Dollar confidence fluctuations

When the US dollar’s status as the global reserve currency is questioned, gold assets priced in dollars benefit, attracting international capital inflows.

Persistent geopolitical risks

Unresolved Russia-Ukraine tensions, conflicts in the Middle East, and other events continue to sustain market safe-haven demand, potentially causing short-term volatility in precious metals.

Market sentiment and capital flows

Media coverage and social discourse continuously attract short-term capital inflows into gold, forming a strong upward momentum.

It’s important to note that many of these factors are short-term in nature, and their changes could trigger sharp gold price fluctuations. For Taiwanese investors, international gold priced in USD also involves exchange rate considerations; fluctuations in USD/TWD will impact final returns.

Investment strategies for different investors

Gold price analysis indicates that current market conditions still present trading opportunities, but different types of investors should adopt tailored strategies.

For short-term traders

If you have some technical analysis skills, volatile markets can offer ample trading opportunities. The liquidity in the gold market makes it relatively easy to judge trends, especially during rapid rises or falls, where the battle between bulls and bears is clear, providing more profit opportunities. However, this requires strong risk management.

For novice investors

If you want to participate in recent volatility, start with small amounts—avoid blindly increasing positions. Managing your mindset is crucial—chasing highs quickly and then experiencing a pullback can lead to psychological breakdowns and capital loss. It’s recommended to familiarize yourself with economic calendar tools and prepare ahead of key US economic data releases.

For long-term holders

If you buy physical gold as part of your asset allocation, be prepared for significant fluctuations. Gold’s annual volatility averages 19.4%, higher than the S&P 500’s 14.7%. While the medium to long-term outlook remains bullish, the process may involve doubling your investment or halving it. Additionally, transaction costs for physical gold generally range from 5% to 20%, which should be factored into your returns.

For portfolio allocators

Gold can be included in your investment portfolio, but over-concentration is not recommended. Diversification remains the more prudent approach. Gold’s cycle is relatively long; only over periods of ten years or more can its role as a store of value be fully realized.

For advanced investors

A combination of long-term holding and short-term trading strategies can be attempted, especially during periods of increased volatility around US market data releases. This requires experience and strict risk control discipline.

Key tips for investing in gold

• Gold’s volatility is comparable to stocks; full psychological preparedness is necessary.
• Gold has clear cyclical characteristics; short-term fluctuations do not indicate long-term trends.
• Transaction costs for physical gold are relatively high; balancing costs and returns is essential.
• Diversification strategies can effectively reduce risk exposure of individual assets.

Overall, gold prices still have medium- to long-term support, but short-term risks should not be ignored. Investors should develop strategies based on their risk tolerance and investment horizon, rather than following the crowd blindly.