Andreja Stojanovic
After what amounts to a persistent year-long rally that saw multiple new all-time highs (ATH) prices set, gold has hit a rough patch in the wake of the 2024 U.S. presidential elections.
Donald Trump’s victory proved a market catalyst, sending many stocks and cryptocurrencies higher but also triggering a 9% plunge for the precious metal from the $2,789 highs to the recent lows near $2,540.
Though there were some fears the commodity would fall below $2,400 and retest the major support near $2,000, gold has again proven its resilience, managing a 1.28% recovery in the last week and a 0.74% surge to $2,631 in the last 24 hours.
The most recent shift in the precious metal’s price direction reignited the bullish forecast, with banking giant Goldman Sachs (NYSE: GS) being the latest to offer an optimistic prediction.
Specifically, Goldman analyst Daan Sturyuven estimated gold would hit $3,000 per ounce by December 2025, specifically stating investors should ‘go for gold.’
Goldman Sachs reveals why Gold will hit $3,000 by December 2025
The experts identified short and long-term systemic risks as drivers of the resurgent rally.
Chief among these are fears about U.S. fiscal stability – exemplified by the worse-than-expected CPI report and extraordinarily high levels of national debt – and rising geopolitical tensions – both in the form of hot conflicts such as the ones in Palestine and Ukraine and the trade war in China expected to emerge from Trump’s promised tariff hikes.
Additionally, though the ‘unprecedented escalation of trade tensions’ was cited as a big driver for the likely speculative positioning pertaining to the precious metal, Goldman Sachs also reflected on the global Central Bank buying spree that has been ongoing for some time as well as on the likely flows to exchange-traded funds (ETFs) emerging from the recent interest rate cuts.
Interestingly, while the price of gold was falling, it was widely linked to the perceived lowering of global tensions stemming from the Republican’s victory.
Most agree Gold will hit $3,000 but few when it’ll happen
Whatever the case, Goldman Sachs’ analysis aligns with the broad strokes of earlier expert predictions for the commodity.
Since late 2023, there has been a general expectation that gold is moving toward a record high at $3,000. Again, interestingly, the estimation for when the milestone would be achieved has been sliding throughout the year despite the precious metal appearing poised to make the final push as it neared $2,800 in late October.
Whatever the specifics of the commodity’s upcoming moves, it appears to have emerged from the danger zone as it reclaimed price levels above $2,600, with a renewed drop toward $2,500 appearing increasingly unlikely.
Furthermore, Goldman Sachs’ forecast might prove wrong with its estimated timetable as, for example, Bloomberg Intelligence’s senior commodity strategist, Mike McGlone, opined when gold was near $2,540 that a sustained close above $2,600 would likely prove a springboard for another try at reaching $3,000.
Featured image via Shutterstock
