Publication date: July 3, 2025
The safe haven. In times of economic uncertainty, investors often turn to one precious metal with an almost mythical status: gold. For thousands of years, it has served as a store of value, a means of payment and a symbol of wealth. The price of gold has doubled since late 2022, but the positive trend is showing hairline cracks. In this article, we dive into the history, the current situation in the gold market and, above all, the expectations for the future. We also highlight the specific characteristics, advantages and disadvantages of this particular asset class.
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History: gold as a measure of value
Gold has been used as a medium of exchange since ancient times and has held a special status since the dawn of human civilization. Starting in the 19th century, it formed the foundation of the monetary system worldwide under the so-called gold standard, in which currencies were directly exchangeable for gold.
Only in 1971, under President Nixon, did the U.S. abandon this peg. The beginning of the modern fiat money system. Yet gold has remained attractive ever since, especially as a hedge against inflation, economic instability and geopolitical tensions.
What is the current state of the gold price?
Over the past 2.5 years, the gold price has consistently recorded new record highs. At the end of 2022, gold was quoted at around $1,600, but on April 22 of this year, the gold price briefly tapped the $3,500 mark. This was partly due to geopolitical tensions (such as the Middle East conflict and uncertainty surrounding China), but also because of ongoing inflation concerns, interest rate expectations and central bank purchases.
Importantly, central banks worldwide are net buyers of gold, particularly countries such as China, India and Russia. This indicates a strategic shift away from dependence on the U.S. dollar.
What is the analyst's expectation of the gold price?
The consensus among major banks is positive. Expectations for the gold price in 2025 average between $2,700 - $3,700, with outliers heading toward $4,000.For 2026 and beyond, J.P. Morgan in particular seems even more optimistic.
What is our expectation for the gold price?
The expectation for the gold price is positive. Our algorithmic model has a price target for 2025 of $3,700 as the most likely scenario. This target is expected to be reached after a price correction that could lead to a gold price of $2,800 - $2,900.This makes it very likely, according to our model, that the gold price will fall about 10 percent over the next few months before initiating a sprint of over 25% to around $3,700.
Below is the price chart of the gold price as of May 2023, with the most likely scenario for 2025 plotted in it.
For the next five years, the system gives a similar price movement as the most likely scenario. After reaching $3,700, the gold price may be under pressure for a somewhat longer period and fall back to around $2,700. In subsequent years, the gold price may continue to rise again to well above $4,000.
Below is the chart of the gold price from 2014, with the most likely long-term scenario plotted.
Investing in gold has unique characteristics that distinguish it from stocks. You can purchase and hold it physically, but gold does not pay interest or dividends. Because of its low correlation with equity markets, gold fits well into a diversified portfolio.
An approachable way to invest in gold is through an ETF (exchange-traded fund), ETC (exchange-traded commodity). These products are easily traded through your bank or broker.
Some well-known examples are:
iShares Physical Gold EUR Hedged ETC
Xtrackers IE Physical Gold EUR Hedged ETC Securities
Invesco Physical Gold EUR Hedged ETC
We have no interest in the above products and mention them for illustrative purposes only. Always do your own research or consult a financial advisor.
Gold is not a panacea, but it can play a stable, strategic role within a balanced portfolio. Especially in uncertain times, it remains attractive as an inflation hedge and means of diversification.
For this year, we expect gold to become interesting again once the correction continues. An entry point around $2,900 may be attractive, with a price target of $3,700 in sight.
Disclaimer: Investing involves risk. Our analysts are not financial advisors. Always consult an advisor when making financial decisions. The information and tips provided on this website are based on our analysts' own insights and experiences. They are therefore for educational purposes only.