2025 Global Gold Price Trend Analysis: From Historic Highs to Future Expectations

Between 2024 and 2025, the global economic situation remains turbulent, and gold has once again become a market focus. In October, gold prices broke through $4,300 per ounce and subsequently hit a historic high near $4,400. Despite a technical correction, investors remain optimistic about the future. Many want to know: Will this round of global gold price rally continue? Is it too late to enter now?

To understand the future trend of gold prices, we first need to grasp the core logic driving this rally. Below, we will analyze the main forces behind gold price fluctuations and the outlook of institutions for 2026.

The Three Core Drivers Behind the Historic High in Gold Prices

1. Safe-haven demand driven by geopolitical and trade policy uncertainties

At the start of 2025, a new wave of tariff policies has been introduced, and market uncertainty has significantly increased. Historical experience (such as during the US-China trade war in 2018) shows that during policy vacuum periods, gold typically experiences a short-term surge of 5–10%. When economic expectations weaken, this safe-haven capital inflow becomes even more evident.

2. The Federal Reserve’s interest rate decisions and their core impact on gold

Gold prices have a clear negative correlation with real interest rates—when rates fall, gold becomes more attractive. The Fed’s policy stance directly influences nominal interest rates, while real interest rates equal nominal rates minus inflation. That’s why gold price fluctuations almost always follow market expectations of rate cuts.

According to CME interest rate tools, the probability of a 25 basis point rate cut in December is 84.7%. Real-time data from FedWatch helps investors quickly assess short-term global gold price trends. Notably, after the September FOMC meeting, gold prices retreated because the 25 basis point rate cut was fully priced in, the market had already digested this, and Powell did not hint at further rate cuts, shifting expectations to hold.

3. Continued central bank gold accumulation boosting long-term demand

According to data from 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 about 634 tons, comparable to the same period last year but well above historical averages.

In the central bank gold reserve survey published by the WGC in June, 76% of surveyed central banks said they plan to increase their gold holdings over the next five years, with most expecting the US dollar reserve ratio to decline. This trend indicates that gold’s role as a “trust asset” globally is strengthening.

Other important factors supporting gold price rises

Besides the three main drivers above, the current rally is also supported by:

Loose monetary policies amid high global debt levels — As of 2025, global debt totals $307 trillion. High debt levels limit countries’ room for interest rate adjustments, leading many to adopt more accommodative monetary policies, which suppress real interest rates.

Shaking confidence in the US dollar — When the dollar weakens or market confidence wanes, gold, as a dollar-denominated asset, benefits and attracts more capital inflow.

Ongoing geopolitical conflicts — The unresolved Russia-Ukraine war and tense Middle East situation increase safe-haven demand for precious metals.

Short-term hype via social media and public opinion — Continuous news reports and social sentiment can trigger large short-term capital inflows, creating a self-reinforcing surge.

It’s important to note that these factors can cause sharp volatility in the short term. For Taiwanese investors, fluctuations in USD/TWD exchange rates will also influence the final valuation of gold returns.

Global gold price outlook: How do mainstream institutions see 2026?

Despite recent volatility, major investment banks remain optimistic about gold’s medium-term outlook.

J.P. Morgan’s commodities team considers this correction a “healthy adjustment,” warning of short-term risks but raising their Q4 2026 target price to $5,055 per ounce.

Goldman Sachs maintains an optimistic stance, reaffirming a target of $4,900 per ounce by the end of 2026.

Bank of America is the most bullish, having previously raised their 2026 target to $5,000 per ounce, with recent strategists suggesting gold could surge to $6,000 next year.

Looking at the physical gold market, well-known jewelers like Chow Tai Fook, Luk Fook Jewelry, Chao Hong Ji, and Chow Sang Sang in Mainland China still quote pure gold jewelry at 1,100 RMB/gram or above, with no obvious decline. This also reflects market confidence in long-term gold demand.

Practical advice for retail investors

After understanding the logic behind this gold price rally, investors can better judge market opportunities. It’s important to emphasize that this rally is not over; both medium- and short-term participation are possible, but blindly following the trend often leads to buying high and selling low.

For experienced short-term traders: Volatile markets provide ample trading opportunities. Gold liquidity is high, and price directions are relatively predictable, especially during sharp surges or drops, where bullish and bearish forces are clear. Using economic calendars to track US economic data releases can effectively support decision-making.

For novice investors: If you want to participate in short-term fluctuations, start with small amounts and avoid aggressive leverage. Gold’s average annual volatility is 19.4%, comparable to the S&P 500’s 14.7%, and emotional breakdowns can easily lead to losses.

For long-term physical gold holdings: Be prepared for significant fluctuations. Gold has a long cycle; over a 10+ year horizon, it can preserve or increase value, but it may also double or halve in value. Additionally, physical gold transaction costs are high (5%-20%), so over-accumulation is not advisable.

As part of a diversified portfolio: Gold can be a suitable asset, but risk diversification principles must be followed. Do not allocate all your funds to a single asset.

Advanced strategy: combining long-term and short-term — Maintain a long-term position while capturing short-term trading opportunities, especially around US market data releases when volatility tends to amplify. This approach requires experience and risk management skills.

In summary, the logic behind the global gold price rise is clear, and medium-term support remains intact. However, in actual trading, short-term risks should be carefully managed, especially around major economic data releases and central bank meetings. Proper capital management and risk control are key to successful gold investment.