Gold Prices Keep Soaring, More New Highs Ahead?

 Gold Prices Keep Soaring, More New Highs Ahead?

Gold Prices Surge: Break Through $3,330, More Records Ahead?

As gold prices once again break the $3,330 per ounce mark, gold has once again attracted investors' attention. This rise is mainly driven by global economic and geopolitical uncertainties, including new US tariff measures, persistently high inflation expectations, and speculation about the Federal Reserve's policy direction.

Why Are Gold Prices Rising?

Traditionally, gold is seen as a safe haven by investors during times of crisis, and this time is no exception. Global markets are unsettled by the US's new tariff plan, which acts like an indirect tax by raising production costs and fueling inflation. This pressure encourages economic participants to invest in lower-risk, non-interest-bearing assets like gold.

Tariff revenues exceeded $27 billion in July, setting a historical record, indicating increased burdens on global trade that may lead to slower growth. If fiscal deficits and US national debt continue to rise, the stability of the US dollar cannot be guaranteed.

Federal Reserve's Room for Maneuver and Interest Rate Expectations

The market is now focusing on the upcoming Jackson Hole symposium and Federal Reserve Chair Jerome Powell's speech. Investors are estimating an 84% probability of a 25 basis point rate cut in September, and possible further easing by the end of the year. Lower interest rates can reduce the opportunity cost of gold, making this non-interest-bearing precious metal more competitive compared to government bonds and the US dollar.

Short-Term Volatility, Long-Term Optimism

Analysts say the market is currently trading in a narrow range between $3,330 and $3,360, usually seen as a signal of an impending breakout. If the price continues to rise and breaks through $3,450, it could trigger new momentum, making the target of $4,000 by the end of 2025 possible, especially if the Federal Reserve indeed adopts a loose monetary policy. Conversely, if Powell signals a tougher stance, gold prices may fall back to $3,300.

Experts suggest that gold's future currently fluctuates within a triangle of US real yields, dollar strength, and monetary policy expectations. While the medium-term trend remains optimistic, investors should closely monitor economic data developments.

Geopolitical Factors and Peace Efforts

Global tensions, especially related to the Eastern European conflict, continue to significantly impact gold prices. Although some have proposed a possible trilateral summit, many remain skeptical about diplomatic breakthroughs. Until clear long-term peace signals emerge, gold will continue to serve as a geopolitical safe haven.

Structural Concerns About US Debt

The long-term stability of the US economy may be questioned, especially as the ratio of national debt to GDP rises. Although credit rating agencies currently maintain a stable outlook for the country, a lack of fiscal discipline could undermine investor confidence in the US dollar. In this context, gold's appeal may further increase.

UBS Forecast: Gold Price Peak in 2026

International investment bank UBS predicts gold prices will rise further, reaching $3,600 by March 2026, $3,700 by the end of June, and maintaining that level in September. The bank also raised its forecast for gold demand: they expect ETF purchases of 600 tons in 2025, compared to the previous estimate of 450 tons.

Central bank purchases may remain strong: although possibly slightly down from last year's record, they will still be an important market factor. According to UBS data, global gold demand could reach 4,760 tons by 2025, reflecting 3% growth and marking the highest level since 2011.

What Does This Mean for Investors?

Gold's role as a "strategic hedge asset" has been revitalized. For investors seeking long-term portfolio stability, this precious metal is an increasingly attractive choice. The current environment—high inflation, geopolitical risks, structural imbalances—continues to favor gold.

As analysts emphasize: gold now balances between the Federal Reserve's strict policies and geopolitical optimism. While upward factors exist, they are not enough to cause a breakout, and downward pressure is insufficient to cause sustained weakness. This balance can maintain demand for gold, especially if new negative economic news emerges.

Gold has once again become a focus for investors and may continue to play an important role in global portfolios in the coming months. Prices are at historic highs, and fundamental factors such as geopolitics, inflation, and fiscal discipline continue to support this trend. For those seeking both safety and opportunity, gold remains one of the best choices in the second half of 2025 and 2026.