2025 Gold Market Outlook: Is There Still Room for Gold Prices to Rise?

After entering the second half of 2024, global markets have experienced intense volatility, and gold has once again become a favorite safe-haven asset. From approaching a historic high of $4,400 per ounce in October to subsequent pullbacks and consolidations, what underlying logic is behind this gold trend? Will it continue to rise in the future? Is it too late for retail investors to enter now? Let’s analyze this round of market movements together.

Why has gold surged so fiercely in 2024-2025?

According to Reuters, the increase in gold prices in 2024-2025 has approached the highest in nearly 30 years, surpassing 31% in 2007 and 29% in 2010. There are three core drivers behind this rapid surge.

Policy Uncertainty Sparks Safe-Haven Demand

Entering 2025, successive tariffs under the new policy framework have been introduced, and market concerns over economic and trade prospects have significantly increased. Historical experience shows that during periods of policy uncertainty, gold typically gains short-term boosts of 5-10%. This risk-averse sentiment has driven up demand for gold, becoming a key engine of this rally.

Federal Reserve Rate Cut Expectations and Real Interest Rates

The Fed’s rate cut decisions directly influence real interest rates. According to the formula “real interest rate = nominal interest rate - inflation rate,” when the Federal Reserve cuts rates, the dollar weakens, and the opportunity cost of holding gold decreases, making gold more attractive.

It’s noteworthy that after the September FOMC meeting, gold prices actually retreated because the market had already priced in a 25 basis point rate cut. Powell characterized this rate cut as a “risk management” move rather than a sustained easing, dispelling expectations of further large cuts. According to CME interest rate tools, the probability of the Fed cutting rates by 25 basis points at the December meeting is 84.7%. Monitoring the Fed’s rate cut trajectory remains an important reference for judging the gold trend.

Global Central Banks Continue to Increase Gold Reserves

According to WGC (World Gold Council) data, in Q3 2025, global central banks net purchased 220 tons of gold, a 28% increase quarter-over-quarter. In the first nine months of 2025, central banks accumulated about 634 tons of gold. In the survey on central bank gold reserves published by the association, 76% of respondents believe they will “moderately or significantly increase” their gold holdings over the next five years, while also expecting the dollar reserve ratio to decline. This reflects a reevaluation of gold as a reserve asset within the international financial system.

What other factors are driving gold prices higher?

Global High Debt and Easing Expectations

By 2025, global debt totals $307 trillion. The high debt levels limit countries’ flexibility in interest rate policies, and monetary policy tends to remain accommodative, indirectly lowering real interest rates and enhancing gold’s relative attractiveness.

Reassessment of Confidence in the US Dollar

When the dollar weakens relative to other currencies or market confidence declines, gold priced in USD benefits, attracting more capital inflows.

Geopolitical Tensions

Ongoing conflicts such as the Russia-Ukraine war and Middle East tensions increase demand for safe-haven assets, often causing short-term volatility in gold prices.

Media and Social Media Effects

Continuous news coverage and social media dissemination drive short-term capital inflows, intensifying market volatility.

It’s important to note that these short-term factors may accumulate to cause sharp fluctuations, but they do not necessarily indicate a long-term trend. For investors in Taiwan, the USD/TWD exchange rate fluctuations also need to be considered when investing in foreign-currency-denominated gold.

What do institutional forecasts say about future gold prices?

Despite recent corrections, major global financial institutions remain optimistic about gold’s outlook.

J.P. Morgan’s commodities team considers the recent pullback a “healthy correction” and has raised its Q4 2026 target price to $5,055 per ounce.

Goldman Sachs reaffirmed its end-2026 target of $4,900 per ounce, maintaining confidence in the long-term trend.

Bank of America is even more optimistic, raising its 2026 target to $5,000 per ounce and suggesting gold could potentially hit $6,000 next year.

Chain jewelry brands such as Chow Tai Fook, Luk Fook Jewelry, Chao Hong Ji, and Chow Sang Sang still quote pure gold jewelry prices above 1100 TWD/gram, with no significant decline, reflecting stability in the physical gold market.

Overall, the medium- to long-term factors supporting gold prices have not changed. As a globally trusted reserve asset, gold’s trend still has upward momentum. However, in actual trading, it’s crucial to pay attention to the volatility around US economic data releases and Federal Reserve meetings.

Can retail investors still buy gold now?

After understanding the logic behind this market movement, you’ll realize that this round of gold rally has not truly ended. Whether for medium-long-term or short-term trading, there are still opportunities. The key is to have a clear strategy rather than blindly follow the trend. Especially for novice investors, high volatility environments can easily lead to chasing tops or cutting losses at bottoms, resulting in repeated losses.

For experienced short-term traders

Volatile markets are the best opportunities for short-term profits. Market liquidity is ample, and the logic behind price swings is relatively clear. During sharp rises or falls, the forces of bulls and bears are easily observed. Tracking US economic data releases via economic calendars can significantly improve trading success rates.

For new investors aiming for short-term trades

Start with small positions and avoid adding excessively. Gold’s average annual volatility is 19.4%, higher than the S&P 500’s 14.7%. Losing composure can quickly deplete capital. Learn to use economic calendars to assist trading and gradually accumulate experience.

For investors holding physical gold

The long-term bullish logic remains valid, but be prepared to endure significant fluctuations along the way. Physical gold has higher transaction costs (usually 5%-20%), so large purchase volumes are not recommended.

For investors looking to include gold in their portfolios

Gold can be incorporated into a diversified portfolio, but avoid putting all your funds into gold. Given its volatility comparable to stocks, diversification is a more prudent strategy.

For investors seeking maximum returns

You can hold long-term positions while timing short-term trades based on price fluctuations. US market data releases often cause the most noticeable volatility, but this requires good risk management skills and market experience.

A few tips for investing in gold:

Gold has an extremely long cycle; over a 10+ year horizon, it can preserve and increase value, but it may double or halve during that period. Do not allocate all your assets into a single asset; diversification is the foundation of long-term wealth growth. Keep a close eye on Federal Reserve policies, economic data, and central bank reserve actions worldwide—these are key indicators for judging gold’s trend.