Does gold still have room to rise? 2025 Gold Price Outlook Analysis

This wave of the gold market is skyrocketing / surge, and many people are asking: Can I still enter now? Instead of waiting and watching, it’s better to first understand the logic behind gold prices.

Why Has Gold Been Rising Continuously? Three Major Factors Driving Gold Price Trends

Trade Policy Uncertainty Brings Safe-Haven Demand

Between 2024–2025, the global policy environment is becoming more volatile, with successive tariff policies adding unpredictability to the market. Historical experience shows that during periods of policy uncertainty, gold typically records short-term gains of 5–10%. A large influx of safe-haven funds has become a key driver of gold price increases.

Changes in U.S. Treasury and Interest Rate Environment

The Federal Reserve’s interest rate cut trajectory directly affects real interest rates, and gold prices show a clear negative correlation with real interest rates—when rates fall, gold’s attractiveness rises. According to CME interest rate tools data, the probability of the Fed cutting interest rates by 25 bps at the December meeting is as high as 84.7%. The expectation of a weaker dollar also enhances gold’s relative attractiveness.

Global Central Banks Continue Buying Gold

Central bank actions often reflect signals of long-term asset allocation. According to the World Gold Council (WGC), in Q3 2025, global central banks net purchased 220 tons of gold, a 28% increase quarter-over-quarter. In the first nine months, total gold purchases reached approximately 634 tons, setting a new high. In a WGC survey, 76% of responding central banks indicated they plan to increase their gold holdings over the next five years, while also expecting a decline in dollar reserves.

Additional Supporting Factors Include

The global debt scale has reached $307 trillion (according to IMF), and in a high-debt environment, countries tend to adopt easing policies, putting pressure on real interest rates; geopolitical risks (Russia-Ukraine war, Middle East tensions) continue to escalate; social opinion drives short-term capital inflows.

How Do Institutions View the Future Gold Trend?

Despite recent adjustments, mainstream institutions remain optimistic about the medium- and long-term prospects of gold.

JPMorgan’s commodities team considers this correction a “healthy adjustment” and has raised its Q4 2026 target price to $5,055 per ounce. Goldman Sachs reaffirmed its end-2026 target price at $4,900 per ounce. Bank of America strategists suggest that gold could even challenge the $6,000 mark next year, having previously raised the 2026 target price to $5,000.

From the physical gold perspective, chain jewelry stores like Chow Tai Fook and Luk Fook Jewelry still quote prices above 1100 TWD/gram, with no obvious decline yet.

How Should Retail Investors Respond to This Wave?

Experienced short-term traders can fully utilize the volatility to seize trading opportunities. The market liquidity is sufficient, and during sharp surges or drops, the bullish and bearish forces are clear, making it suitable to ride the wave. But remember to use economic calendars to track U.S. data release times.

New investors wanting to participate should start with small amounts and avoid blindly increasing their positions. Gold’s annual volatility is 19.4%, which is not lower than stocks (S&P 500’s average 14.7%), so the mindset can easily collapse.

Long-term physical gold holders should be mentally prepared to endure short-term intense fluctuations. Although the long-term bullish logic is sound, over a 10-year cycle, prices may double or be cut in half, and transaction costs for physical gold can be as high as 5–20%.

Allocation investors can include gold in their portfolios but should not invest all their assets in it. Diversification is more stable. To maximize returns, you can hold long-term positions and seize short-term volatility around U.S. market data releases.

Core Reminder: Gold has higher volatility than stocks, with an extremely long cycle, and transaction costs are not low. Over-concentration is not recommended. While there is still a chance for gold prices to rise in 2025, decisions should be made cautiously based on your own risk tolerance.