Dec 16 2024: Gold is projected to maintain its status as a safe-haven asset in 2025, supported by heightened geopolitical and economic uncertainties along with sustained central bank purchases, according to analysts at ANZ.
Despite challenges from a strong U.S. dollar and anticipated Federal Reserve rate cuts, ANZ forecasts a moderate return of around 10% for gold, with prices potentially hitting a record high of $2,900 per ounce next year.
Geopolitical risks, including escalating tensions in the Middle East and trade policies under Trump, are expected to drive continued demand for gold, the analysts noted.
ANZ’s analysis also emphasizes the pivotal role of China and India in shaping global gold demand. Economic stimulus measures in China, along with fluctuations in the yuan, are likely to boost investment in gold bars, coins, and ETFs. Meanwhile, India’s gold consumption is predicted to remain strong, fueled by rising incomes and reduced import duties, with jewellery demand expected to grow by 9%, according to the report.
On the supply side, central banks are set to remain significant buyers, albeit at a slower pace. ANZ estimates central bank purchases will total approximately 850 tons in 2025, compared to 950 tons in 2024, as nations such as Russia, China, and India continue to build their reserves.
Gold prices are expected to encounter resistance at the $2,780-$2,790 range but could advance to $2,900 if these levels are surpassed. However, price momentum will heavily depend on shifts in U.S. monetary policy and unfolding geopolitical events.
This cautiously optimistic outlook reinforces gold’s role as a hedge against rising macroeconomic risks, offering a “modest shine” in the coming year.
