Investing.com– Gold is expected to maintain its safe-haven appeal in 2025 as elevated geopolitical and economic uncertainties, coupled with heavy central bank purchases, are expected to support prices, ANZ analysts said.
As headwinds from a strong US dollar and Federal Reserve rate cuts persist, ANZ forecasts moderate returns of around 10% for the yellow metal, with prices potentially reaching record highs of $2,900 l ounce next year, ANZ analysts said in a note.
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Geopolitical risks – such as growing tensions in the Middle East and challenges stemming from Trump’s trade policies – will likely keep demand for gold high, analysts said.
ANZ’s outlook also highlights the role of China and India in driving demand. China’s economic support measures and yuan volatility are expected to boost investment demand for gold bars, coins and ETFs. Meanwhile, gold consumption in India is expected to remain strong, supported by rising incomes and reduced import duties, with a 9% increase in jewelry demand forecast, according to ANZ.
On the supply side, central banks will remain active buyers, albeit at a slower pace. ANZ forecasts annual gold purchases by central banks will be around 850 tonnes in 2025, down from 950 tonnes in 2024, as countries including Russia, China and India stockpile reserves.
ANZ analysts said it could face resistance between $2,780 and $2,790 an ounce, but could recover towards $2,900 if those levels are breached. However, price dynamics are expected to depend heavily on US monetary policy and geopolitical developments.
This continued but cautious optimism underscores gold’s role as a hedge against growing macroeconomic risks, providing “modest shine” in the year ahead.
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