ING Predicts Gold to Surge to $3,000 This Quarter
Safe Haven Demand Boosted by Trade Uncertainty and Geopolitical Tensions
ING analysts anticipate a significant surge in gold prices this quarter, with a target of $3,000 per ounce. This bullish outlook is driven by heightened investor demand for safe haven assets amidst ongoing trade disputes and geopolitical uncertainties.
Gold's record-high performance at the beginning of 2025 is attributed to the influx of investors seeking protection from political volatility. The recent policies of the Trump administration have accelerated these gains, pushing gold to over $2,880 per ounce on Wednesday, a record high that exceeds the previous year's target.
Macroeconomic Factors Supporting Gold's Rise
Gold is widely recognized as a hedge against macroeconomic and geopolitical risks. Its high demand this year is fueled by the escalating trade uncertainties stemming from the Trump administration's tariff policies. The announcement and subsequent delay of tariffs on goods from Canada and Mexico have heightened concerns about inflationary shocks, driving investors towards gold as a safe haven.
ING analysts emphasize the persistent uncertainty surrounding trade and tariffs as a key factor supporting gold prices. Retaliatory measures and intensifying tensions would further strengthen gold's safe haven appeal.
Supply Concerns and FED Rate Cuts
Fears of restricted access to physical gold due to potential tariffs have also contributed to its allure, ING reports. While gold has not been explicitly targeted, its inclusion in future tariffs remains a possibility. Mexico and Canada accounted for a significant portion of gold imports into the US in 2024, and Trump's tariff threats extend beyond these countries.
The accumulation of $82 billion in gold stockpiles in New York, fueled by tariff anxiety, has created shortages elsewhere and has led to a premium on Comex gold inventories. ING anticipates that this stockpiling could further drive up prices.
Additionally, the Federal Reserve's expected interest rate cuts this year will likely stimulate gold purchases. Lower interest rates can lead to inflation, further enhancing the appeal of gold as a hedge.
Central Bank Demand Remains Strong
Foreign central banks continue to be major supporters of gold and are expected to maintain their substantial purchases this year. Gold diversification has become a strategy for central banks to reduce dependence on the US dollar in their foreign reserves. The World Gold Council reports that central bank buying has surpassed 1,000 tons for the third consecutive year, reaching a record 333 tons in the fourth quarter of 2024.
Outlook from Other Analysts
ING is not alone in its optimistic outlook for gold. UBS has also revised its forecast, raising its 12-month gold target from $2,850 per ounce to $3,000 per ounce. Both firms expect continued volatility in the markets and anticipate further risk-averse investment behavior, propelling gold prices higher.