Gold Outlook World Gold Council, WGC gold outlook 2025: The World Gold Council (WGC) has released its yearly Gold Outlook for 2025, forecasting an exceptional year for the precious metal. Gold has already reached 40 new historical highs in 2024, marking a 28% year-to-date increase. This record-breaking performance has been driven by robust central bank and investor buying, which has counterbalanced a notable slowdown in consumer demand.
Trump’s Second Term and Global Economic Dynamics
As Donald Trump begins his second term, the global economy faces both opportunities and uncertainties. While the U.S. economy might see a boost, investor concerns about geopolitical risks and economic policies could influence gold’s trajectory.
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Market Expectations for 2025
Current expectations for GDP, yields, and inflation suggest positive but modest growth for gold in 2025. According to Juan Carlos Artigas, Global Head of Research at WGC, “2025 is set to be marked by evolving fiscal and economic policies that may result in shifting global dynamics. For gold, 2025 will be a tale of two halves – first, we may experience more risk-on appetite as we wait for strategic and tactical drivers to unravel, leading to more clarity and direction for gold’s performance later in the year. This could really ring true if there is a significant drop in interest rates or a marked increase in market volatility to further fuel investor interest. We also expect global central bank demand and Asian markets to continue playing a pivotal role.”
China and India’s Key Roles
China’s consumers have remained on the sidelines, with investors stepping in to support the gold market. The nation’s economic policies, including trade and stimulus measures, will be critical in shaping gold demand. Meanwhile, India is on stronger economic footing with growth above 6.5%. This resilience supports gold consumption and financial gold investment products, which have seen remarkable growth despite constituting a smaller portion of the overall market.
Evolving Drivers of Gold in 2025
WGC emphasizes four primary factors influencing gold’s performance:
Economic Expansion: Its direct impact on consumer demand.
Risk and Uncertainty: Driving investor demand for safe-haven assets.
Opportunity Cost: Relative attractiveness of gold compared to bond yields.
Momentum: Trends that either amplify or stabilize gold prices.
Juan Carlos Artigas, Global Head of Research, World Gold Council added, “Gold is having a record-breaking year due to a confluence of factors, driving the gold price and demand to record levels. And while the current consensus on global economic performance suggests that gold could move sideways, the uncertainty surrounding the geopolitical landscape could provide a springboard for gold next year.2025 is set to be marked by evolving fiscal and economic policies that may result in shifting global dynamics. For gold, 2025 will be a tale of two halves – first, we may experience more risk-on appetite as we wait for strategic and tactical drivers to unravel, leading to more clarity and direction for gold’s performance later in the year. This could really ring true if there is a significant drop in interest rates or a marked increase in market volatility to further fuel investor interest. We also expect global central bank demand and Asian markets to continue playing a pivotal role.”
Central Banks: The Steadfast Buyers
Central banks have remained net buyers of gold for nearly 15 years, driven by its role as a diversifier, store of value, and safe haven during crises. The WGC expects central bank demand in 2025 to exceed the long-term trend of 500 tonnes, which should support prices. However, a slowdown below this level could pose challenges.
2025: A Tale of Two Halves
The WGC anticipates 2025 to be divided into two distinct phases. The first half may see a risk-on environment as markets await clarity on strategic and tactical drivers, while the latter half could bring more decisive trends for gold, particularly if rate cuts or heightened market volatility occur.
Rangebound or Breakout?
The WGC’s QaurumSM analysis suggests that gold will likely remain rangebound if market expectations for 2025 hold. However, significantly lower interest rates, heightened geopolitical risks, or deteriorating financial conditions could push gold prices higher. Conversely, persistently high rates or weakening consumer demand, especially in Asia, may create headwinds.
Conclusion
World Gold Council Report says ”analysis, based on QaurumSM, examines gold’s potential reaction to underlying market conditions based on the current consensus as well as a more bearish and bullish scenarios. Gold is likely to remain rangebound if existing market expectations are correct. However, a combination of higher rates and lower economic growth could negatively affect investors and consumers. This could be particularly evident in Asia. Conversely, significantly lower interest rates, or a deterioration in geopolitics or financial market conditions will improve gold’s performance. Finally, a key checkpoint will be central bank demand as it will continue to provide a boost to gold if it remains at a healthy level. Gold’s final price performance will depend on the interaction of gold’s four key drivers: economic expansion; risk; opportunity cost; and momentum.”
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The information provided in this article is for informational purposes only and reflects the views of industry experts. Before making any investment decisions, it is recommended that you consult a financial advisor. The team at Gold Price Today does not engage in personal buying, selling, or trading of gold or silver on exchanges. We are not responsible for any gains or losses incurred based on the information presented here.