The price of gold should climb to $3,100 or even $3,200 an ounce, strategists at Goldman Sachs and UBS have predicted, from $2,900 on Tuesday morning.
Goldman Sachs raised 2025 forecast to $3,100, citing higher central bank demand, while UBS mooted the possibility of seeing a high of over $3,200 this year, "before prices gradually ease and stabilise at elevated levels over the next few years".
Higher central bank demand and gradual additions to exchange-traded fund holdings will lift the gold price, Goldman estimated, with a potential rise to $3,300 per oz also mooted if "policy uncertainty – including tariff fears – stays high".
Gold has risen from $2,623 per oz at the start of this year, and up from just over $2,000 at the start of 2024.
There have been "unprecedented market dislocations" as well as new record high prices since the start of the year, UBS strategist Joni Teves said.
She said a fresh assessment of market conditions prompted the updated view of gold and led to a higher price forecasts.
Teves said her team predicts "a more forceful rally" than previous expectations, which is likely to be driven three factors, led by a "deep-rooted bullish sentiment, with gold seen as a safe-haven asset amid a highly uncertain and volatile macro environment".
FOMO is another factor, with a "continued lack of investor positioning" suggesting there is plenty of scope for investors to add gold to portfolios, as well as stronger-than-expected official sector demand.
"After missing several (brief/ shallow) buying opportunities in 2024, investors are likely wary of repeating the same patterns and may want to take advantage of corrections sooner this time around.
"Moreover, liquidity issues could amplify rallies and make the market vulnerable on the upside to any pick up in physical demand," the UBS strategist said.
Silver and platinum have the potential to outperform gold "materially" in percentage terms from current levels, the UBS team believes, with both metals benefitting from a positive correlation with gold and "compelling" supply/demand fundamentals.
"That said, the challenge for silver is that it is likely to see higher volatility and lower investor conviction as it gets caught between its identity as a precious and an industrial metal."
Platinum demand could be hit by less liquid market conditions and a longer investment horizon.
Another precious metal highlighted by UBS is palladium, where prices rose to a peak in 2021 of over $2,960 but have since fallen back to just below $1,000, levels last seen seven years ago.
This metal "has the potential for interim spikes", said Teves, based on expectations that the market will remain in deficit for a couple more years, meaning "prices are likely to be vulnerable to any sign of supply anxiety".
But, unlike gold and silver, there is a lack of a long-term bullish narrative which should keep prices within a broad range.